Delhi High Court
Damayanti Verma (Deceased) ... vs Lic And Anr. on 25 July, 2011
Author: Kailash Gambhir
IN THE HIGH COURT OF DELHI AT NEW DELHI
Judgment reserved on: 7.04.2011
Judgment delivered on: 25.07.2011
W.P.(C) No.4342/2007
DAMAYANTI VERMA (DECEASED)
THROUGH HER L.Rs ......Petitioner
Through: Mr.Bahar-U-Barqi, Adv.
Vs.
LIC AND ANR. ......Respondents
Through: Mr. Mohinder Singh,
Advocate.
W.P.(C) No.4344/2007
DAMAYANTI VERMA (DECEASED)
THROUGH HER L.Rs ......Petitioner
Through: Mr.Bahar-U-Barqi, Adv.
Vs.
LIC AND ANR. ......Respondents
Through: Mr. Mohinder Singh,
Advocate.
W.P.(C) No.13393/2009
DAMAYANTI VERMA (DECEASED)
THROUGH HER L.Rs ......Petitioner
Through: Mr.Bahar-U-Barqi, Adv.
Vs.
LIC AND ANR. ......Respondents
Through: Mr. Mohinder Singh,
Advocate.
W.P.(C) No.4342/2007 & Ors. Page 1 of 57
W.P.(C) No.13628/2009
DAMAYANTI VERMA (DECEASED)
THROUGH HER L.Rs ......Petitioner
Through: Mr.Bahar-U-Barqi, Adv.
Vs.
LIC AND ANR. ......Respondents
Through: Mr. Mohinder Singh,
Advocate.
CORAM:
HON'BLE MR. JUSTICE KAILASH GAMBHIR
1. Whether the Reporters of local papers may Yes
be allowed to see the judgment?
2. To be referred to Reporter or not? Yes
3. Whether the judgment should be reported Yes
in the Digest?
KAILASH GAMBHIR, J.
*
1. This judgment shall dispose off a batch of four writ
petitions bearing WPC No. 4342/07, WPC No. 4344/07, WPC
No. 13393/09 & WPC No. 13628/09 filed by the same
petitioner under Article 226 of the Constitution of India.
2. By WPC No. 4342/07 & WPC No. 4344/07, the
petitioner seeks to set aside the common judgment and
decree dated 22.5.07 whereby the appeal filed by the
petitioner against the order passed by the Estate Officer
dated 18.4.06 under section 5 of the Public Premises Act,
1971 was dismissed. By WPC No. 13393/09 & WPC No.
13628/09 the petitioner assails the common order dated
29.10.09 whereby the appeal filed by the petitioner against
the order of the Estate Officer dated 18.4.06 under section 7
of the PP Act was dismissed.
3. Facts of the case shorn of unnecessary details
forming the heart of the controversy of these petitions are
that the husband of the petitioner late Sh.P.L Verma was a
tenant of two premises bearing Flat no. 14/12190
admeasuring 333 sq ft and Flat no. 7/10181 admeasuring 782
sq ft. on the first floor of the building known as the Tropical
Building, situated at H Block, Connaught Circus, New Delhi
which are owned by the respondent Corporation. That the
respondent Corporation required the premises for its own
bonafide use and hence terminated the tenancy of the
petitioner w.e.f 28.2.97 and served a legal notice dated
1.2.97/6.2.97 on the petitioner. That a notice dated 7.1.98
under section 4(1) & 4(2)(b)(ii) & 7(3) of the PP Act was
served on the petitioner in respect of the Flat No. 7/10181
and similarly a notice dated 12.1.98 was served in respect of
the Flat no. 14/12190 and proceedings under section 5 & 7 of
the PP Act were initiated against the petitioner whereby vide
order of the Estate Officer dated 18.4.06 the petitioner was
declared to be in unauthorized occupation of the premises
w.e.f 1.3.97 and was directed to pay damages. Consequently
the petitioner filed appeals against the said order which vide
impugned orders 22.5.07(for eviction) and 29.10.2009(for
damages) in respect of both the premises were dismissed.
Feeling aggrieved with the same, the petitioner (now
deceased, through her legal representatives ) has preferred
the present writ petitions.
4. Learned counsel for the petitioner at the outset
submitted that for deciding the present petitions a brief
sketch of the background which has necessitated the filing of
the present petitions is important. Counsel submitted that it
is an admitted position that the husband of the deceased
petitioner was the original tenant of the premises who
entered into tenancy of the premises in the year 1946.
Counsel further submitted that in 1946 the premises which
are the subject matter of the present petitions belonged to a
private party and then LIC was not in existence which came
into existence in the year 1966 whereafter the husband of the
petitioner got retired and then expired in the year 1987.
Counsel submitted that during the intermittent period, LIC
had taken over the premises and claimed that the petitioner
should be governed by the Public Premises Act. Counsel thus
submitted that the petitioner was tenant of a private landlord
and from a private landlord, respondent LIC had taken over
and the petitioner therefore happened to be under the
tenancy of a new landlord. The contention of the counsel for
the petitioner was that the statutory provisions must be
complied with by implementation of the provisions
enshrined in the Public Premises Act, the guidelines issued
by the Ministry of Urban Development for preventing the
misuse of the Public Premises Act should alone be the
guiding factor. Counsel thus submitted that neither the
provisions of the Act can be implemented in isolation and
similarly nor the guidelines can be enforced in isolation.
Emphasizing the importance of the said guidelines, the
counsel submitted that keeping in view the law laid down by
different High Courts and the Hon‟ble Supreme Court and
the ongoing misuse of the Public Premises Act, the guidelines
were debated upon in both the floors of the House and these
guidelines were firstly adopted in Rajya Sabha and then the
Lok Sabha and thereafter the concerned Ministry got it
published. Counsel thus submitted that these are not
administrative guidelines but are legislative guidelines and
therefore neither the guidelines nor the provisions of P.P.
Act can be read in isolation and both should be harmonized
together so as to pay sincere regard to the discussion in both
the Houses of the Parliament.
5. Another argument of the counsel for the petitioner was
that the petitioner has the protection of the Delhi Rent
Control Act and thus the provisions of the Public Premises
Act cannot be invoked against her. The counsel further
submitted that as far as the termination notice under section
106 of the Transfer of Property Act is concerned, it was not a
valid notice in the eyes of law. The contention of the counsel
of the petitioner was that the said notice was never served
upon the petitioner and therefore there is no question of
termination of tenancy without the due service of notice.
6. Counsel for the petitioner further submitted that the
onus was on the respondent to prove two basic issues, firstly
to prove that the petitioner was the unauthorized occupant
in the said premises and secondly that the respondent
corporation required the premises for their own bonafide use.
The contention of the counsel for the petitioner was that
without properly spelling out the exact bonafide requirement
of the said premises, the respondent Corporation could not
have terminated the tenancy of the petitioner. In support of
his arguments, counsel for the petitioner placed reliance on
the following judgments:
1. Persis Kothawala vs. LIC 2004 AIHC 2613 (Bombay High Court)
2. Nusli Neville Wadia vs. New India Assurance Co. Ltd 2006(3)
Mh.L.J (Bombay High Court)
3. Dunlop India Ltd. Vs. Bank of Baroda 2010 II AD(Delhi) 422
4. New India Assurance Compnay Ltd. Vs. Nusli Neville Wadia &
Anr. (2008)3 SCC 279
5. The Indian Bank, Bangalore vs. M/s Blaze and Central(P) Ltd. AIR
1986 Kar 258
6.Uttam Prakash Bansal & Ors. vs. LIC 100(2002)DLT 497 (Delhi
High Court)
7. Refuting the above arguments of learned counsel
for the petitioner, Mr. Mohinder Singh, learned counsel for
the respondent submitted that under the P.P. Act, the
respondent LIC was not required to show its bona fide
requirement. He submitted that in the case of The Indian
Bank, Bangalore vs. M/s Blaze and Central AIR 1986 Kar 258,
on which reliance was placed by the counsel for the
petitioner, there the tenant did not deny that he was not an
unauthorized occupant but their case was that the
respondent did not have any bona fide requirement whereas
in the case at hand, the petitioners denied their unauthorized
occupancy but the respondent has successfully proved it
and hence the said judgment would not be applicable to the
facts of the present case.
8. Counsel for the respondent further submitted
that this Court in exercise of its writ jurisdiction will not act
as a Court of second appeal to re-examine the findings of
facts arrived at by both the courts below. Counsel argued
that this Court in the exercise of its writ jurisdiction will only
examine as to whether the petitioner was given due
opportunity to defend herself before the Estate Officer and
that there is no violation of principles of audi alteram partem
and also the fact as to whether the petitioner was able to
establish her status as that of an authorized occupant.
Counsel further submitted that on both the counts the
petitioner cannot raise any grievance as the petitioner was
given sufficient opportunity before the Estate Officer to
establish her status as that of an authorized occupant but the
petitioner failed in her attempt. Counsel thus submitted that
after the termination of the tenancy of the petitioner after
due service of the notice under Section 106 of the Transfer of
Property Act, the petitioner clearly became unauthorized
occupant in terms of Section 2(g) of the Public Premises
(Eviction of Unauthorized Occupants) Act, 1971 and after the
termination of tenancy, the petitioner derived no right to
occupy the premises in question. Counsel also submitted that
after the termination of the tenancy of the petitioner, the
petitioner became liable to pay damages as already awarded
by the learned Estate Officer in respect of both the premises
under her occupation and the award of said damages has
already been upheld by the learned Appellate Court.
9. Counsel for the respondent also argued that the said
"guidelines" on which strong reliance was placed by counsel
for the petitioner cannot come to her rescue as these
guidelines have no statutory force and, therefore, cannot
supplant the substantive provisions of the Public Premises
Act and could not come in the way of the respondent to take
recourse to the statutory remedy as provided under the
provisions of the Public Premises Act. In support of his
arguments, counsel for the respondent placed reliance on the
following judgments:-
1. The Indian Bank, Bangalore vs. M/s Blaze and Central(P) Ltd.
AIR 1986 Kar 258
2. Uttam Prakash Bansal & Ors. vs. LIC 100(2002)DLT 497 (Delhi
High Court)
10. I have heard learned counsel for the parties at
considerable length and given my thoughtful consideration to
the arguments advanced by them.
11. The facts which are not in dispute are that late
Shri P.L.Verma, husband of the petitioner was a lawful tenant
in respect of Flat bearing No.14/12190 measuring 333 sq.ft.
on the first floor of the Tropical Building situated at H Block
Connaught Circus, New Delhi at a monthly rent of Rs.73.00
and also in respect of another flat bearing No. 7/10181,
admeasuring 782 sq. ft. on a monthly rent of Rs.87.86/-. It is
also not in dispute that said Shri P.L.Verma became tenant in
respect of the said flats prior to his joining the respondent-
LIC as an employee. It is further not in dispute that after the
demise of Shri P.L.Verma, the present petitioner was
accepted as a tenant in his place. As per the respondent-LIC,
the said tenancy of the petitioner was terminated by the
respondent under Section 106 of the Transfer of the Property
Act, of which notice was served upon the petitioner through
affixation after the notice sent by the registered A/D post was
refused by the petitioner. Counsel for the respondent took a
stand that the said notice was duly proved on record by the
respondent before the Estate Officer as Ex. PW1/10.
However, counsel for the petitioner strongly disputed the
receipt of the said notice, but in my considered view, there is
no reason to disbelieve the service of the said notice upon the
petitioner which was affixed only after the same was refused
as per the refusal report of the postal authorities. It is not the
case of the petitioner that the address mentioned in the
notice or on the returned envelope was incorrect or that
anything could have affected the normal course of business of
the postal authorities to discredit their service report. With
the postal receipt of the notice sent through registered A/D
post carrying the correct address thereon and also the notice
sent by the respondent by UPC and the subsequent notice
pasted through affixation, the presumption under Section 27
of the General Clauses Act,1897 of due service of the notice
would arise in favour of the respondent and, therefore, this
Court would proceed to examine the submissions advanced
by counsel for the parties taking the due service of the said
notice upon the petitioner.
12. As per the legal notice dated 01.02.1997/6.2.1997
sent by the respondent, the tenancy of the petitioner was
terminated under Section 106 of the Transfer of Property Act
and the reason given for the termination of the said tenancy
was that the respondent-LIC required the said premises for
their own bonafide use. Based on the said termination notice,
the learned Estate Officer issued notice under sub Section 1
and Clause b(ii) of sub-Section 2 of Section 4 of the Public
Premises Act after forming an opinion that the petitioner
became unauthorized occupant of the said tenanted premises
after her tenancy was determined by the respondent through
the said legal notice dated 01.02.1997/6.2.1997. Similarly
notices were issued by the learned Estate Officer under sub
Section 3 of Section 7 of the Public Premises Act thereby
calling upon the petitioner to pay the claimed damages along
with the interest.
13. The entire thrust of counsel for the respondent
was on this notice of termination. With the service of the said
notice, the tenancy of the petitioner got terminated w.e.f.
28.2.97 and thereafter the petitioner became unauthorized
occupant in respect of the said premises from 1.3.97. Counsel
also argued that neither under Section 106 of the Transfer of
Property Act nor under Section 2(g) of the Public Premises
Act, the respondent-LIC is required to give any reason for
terminating the tenancy of a tenant. Counsel also submitted
that it was for the petitioner to satisfy the learned Estate
Officer as to how she could claim her status as that of an
authorized occupant after the termination of the tenancy.
Counsel for the petitioner, on the other hand, placed strong
reliance on the 2002 Guidelines issued by the Ministry of
Urban Development to prevent arbitrary use of powers to
evict genuine tenants by various public sector undertakings
and financial institutions. The counsel for the petitioner
vehemently argued to reiterate the contention that the said
guidelines are binding upon the respondent and that there
can be no laxity on the part of the respondent to act contrary
to the spirit of these guidelines.
14. In the face of the factual matrix of the petitions
and the contentions of the parties stated herein above, two
crucial questions which arise for consideration by this Court
in the present case would be:
(1) Whether the Public Sector Undertakings, Govt.
Corporations and other Financial Institutions are not
bound by the 2002 guidelines because they lack the
statutory force?
and
(2) Whether the Estate Officer should not probe the
reasons for satisfying itself before declaring a particular
person as an unauthorized occupant in respect of
premises in dispute?
15. So far the answer to the second question is
concerned, in the case of Jiwan Das Vs. LIC
1994 Supp(3)SCC694, the Apex Court took a view that
before issuing a notice determining the tenancy or revoking
the license, it is not necessary for the owner to assign any
reason to establish that it was just and germane for the
purpose which could be tested on the touchstone of Article
14 of the Constitution of India. Relevant para of the said
judgment is reproduced as under:
"4. Section 106 of the T.P. Act does indicate that the landlord is
entitled to terminate the tenancy by giving 15 days' notice, if it is a
premises occupied on monthly tenancy and by giving 6 months' notice
and if the premises are occupied for agricultural or manufacturing
purposes; and on expiry thereof proceedings could be initiated.
Section 106 of the T.P. Act does not contemplate of giving any reason
for terminating the tenancy. Equally the definition of the public
premises "unauthorised occupation" under Section 2(g) of the Act
postulates that the tenancy "has been determined for any reason
whatsoever". When the statute has advisedly give wide powers to the
public-authorities under the Act to determine the tenancy, it is not
permissible to cut down the width of the powers by reading into it the
reasonable and justifiable grounds for initiating action for terminating
the tenancy under Section 106 of the T.P. Act. If it is so read
Section 106 of T.P. Act and Section 2(g) of the Act would become ultra
vires. The statute advisedly empowered the authority to act in the
public interest and determine the tenancy or leave or licence before
taking action under Section 5of the Act. If the contention of the
appellant is given acceptance he would be put on a higher pedestal
than a statutory tenant under the Rent Act. Take for example that a
premises is let out at a low rent years back like the present one. The
rent is unrealistic. With a view to revise adequate market rent, tenant
became liable to ejectment. The contention then is, action is violative
of Article 21 offending right to livelihood. This contention too is devoid
of any substance. An owner is entitled to deal with his property in his
own way profitable in its use and occupation. A public authority is
equally entitled to use the public property to the best advantage as a
commercial venture. As an integral incidence of ejectment of a
tenant/licensee is inevitable. So the doctrine of livelihood cannot
discriminately be extended to the area of commercial operation."
In the case of Dr.KRK Talwar Vs. Union of India
1977(13) DLT 310, this court took a view that the Estate
Officer rightly held that he was not to sit in judgment over
the sufficiency of administrative reasons for cancellation of
allotment. The Court also took a view that it is not
permissible in the course of judicial review to probe into the
reasons for such an action.
Let us consider the validity of each of these orders and the scope of
judicial review in respect of each of them. (A) The definition of
"unauthorised occupation" in section 2(e) of the Act is the occupation
by. any person of the public premises after the authority under which
he was .allowed to occupy the premises has expired or has been
determined for any reason whatsoever. The authority for the
occupation of Dr. Talwar was the original allotment or lease granted to
him. When this lease was terminated or allotment was cancelled, that
authority disappeared and he became a person in unauthorised
occupation of the premises. The non-payment of rent by the petitioner
for a long time was an overwhelmingly sufficient reason for the
termination of the lease and the cancellation of the allotment. The
petitioner's counsel contended that the real reason for such action was
the suspicion of the authorities that the premises had been sublet by
Dr. Talwar to Shri Batra. The Lesser or the allottor has an absolute
right to terminate the lease or cancel the allotment. It is not
permissible in the course of judicial review to probe into the reasons
for such action. The justifiability of such an action is not open to
judicial review at all. Moreover, the non-payment of rent for a long
time was a complete justification for such an action.
16. It is now a settled legal position that unlike the
provisions of the Delhi Rent Control Act, no such protection is
available to the tenants under the provisions of the Public
Premises Act. It is again a settled legal position that so far
the case of lawful tenants under any Government
Undertaking or Corporation is concerned, the tenancy of
such a tenant can be terminated under Section 106 of the
Transfer of Property Act and no reasons are required to be
given by the owner/landlord for such termination of the
tenancy. Once such a tenancy is terminated, then the lawful
tenant also becomes an unauthorized occupant in terms of
Section 2(g) of the Public Premises Act. It also cannot be lost
sight of the fact that the case of lawful tenant or lessee
cannot be treated at par with unlawful occupants or the
licensees whose license comes to an end on the expiry of the
license period or an employee overstaying in the public
premises after his/her service comes to an end or in case of
his/her transfer. In the latter category of cases, once declared
as unauthorized occupant by the Estate Officer, then the
tenant has to satisfy and prove before the Estate Officer that
the decision of formation of such an opinion by the Estate
Officer is wrong and illegal and their status is that of an
authorized occupant. However, if they fail to satisfy the
Estate Officer then they have no option but to face the
eviction proceedings under Section 5 of the Public Premises
Act. But the question is that whether the lawful tenants
would also fall in the same category once their lease deed is
determined by the lessor/owner under Section 106 of the
Transfer of Property Act. The answer again would be in the
affirmative, going by the legal position settled in the
judgments referred above. Hence, the answer to the second
question formulated herein above would be a simple „yes‟ and
in such like cases also with the determination of tenancy, a
person would become an unauthorized occupant with no
right to raise any plea to the contrary.
17. Now before furthering the discussion on the first
question formulated herein above, it is pertinent to deal with
the contention of the counsel for the petitioner that the
petitioner has the protection of the Delhi Rent Control Act
and that the provisions of the Public Premises Act cannot be
invoked against the petitioner. In the celebrated
pronouncement of the Constitution Bench of the Supreme
Court in the case of Ashoka Marketing Ltd. and Anr. vs
Punjab National Bank and Ors. AIR1991SC855, the
Supreme Court in depth examined the ambit and the scope of
two Statutes i.e. Delhi Rent Control Act, 1958 and the Public
Premises Act, 1971 in relation to the premises which fall
within the ambit of both the Statutes. The Supreme Court
also traced the legislative history which led to the enactment
of the Public Premises Act by the Parliament in 1971. After a
detailed discussion on the provisions of both the Statutes, the
Hon‟ble Court came to the conclusion that the provisions
contained in the Public Premises Act cannot be applied to the
premises which fall within the ambit of the Rent Control Act.
It was also held that the provisions of Public Premises Act, to
the extent that they cover premises which are falling within
the ambit of Rent Control Act, override the provisions of the
Rent Control Act and a person in unauthorized occupation of
the Public Premises as defined under Section 2(e) of the PP
Act cannot invoke the provisions of the Rent Control Act. It
would be relevant to reproduce the following paras of the
said judgment here:-
"53. The Public Premises Act is a later enactment, having been
enacted on 23rd August, 1971, whereas the Rent Control Act was
enacted on 31st December, 1958. It represents the later will of
Parliament and should prevail over the Rent Control Act unless it
can be said that the Public Premises Act is a general enactment,
whereas the Rent Control Act is a special enactment and being a
special enactment the Rent Control Act should prevail over the
Public Premises Act. The submission of learned Counsel for the
petitioners is that the Rent Control Act is a special enactment
dealing with premises in occupation of tenants, whereas the
Public Premises Act is a general enactment dealing with the
occupants of Public Premises and that insofar as public premises
in occupation of tenants are concerned the provisions of the Rent
Control Act would continue to apply and to that extent the
provisions of the Public Premises Act would not be applicable. In
support of this submission reliance has been placed on the non-
obstante clauses contained in Section 14 and 22 of the Rent
Control Act as well as the provisions contained in Sections 50 and
54 of the said Act. On the other hand the learned Counsel for the
respondents have urged that the Rent Control Act is a general
enactment dealing with the relationship of landlord and tenant
generally, whereas the Public Premises Act is a special enactment
making provision for speedy recovery of possession of Public
Premises in unauthorised occupation and that the provisions of
the Public Premises Act, a later Special Act, will, therefore,
override the provisions of the Rent Control Act in so far as they
are applicable to Public Premises in occupation of persons who
have continued in occupation after the lease has expired or has
been determined. The learned Counsel for the respondents have
placed reliance on Section 15 of the Public Premises Act which
bars the jurisdiction of all courts in respect of the eviction of any
person who is in unauthorised occupation of any Public Premises
and other matters specified therein. It has been submitted that
the said provision is also in the nature of a non-obstante clause
which gives overriding effect to the provisions of the Public
Premises Act. Thus each side claims the enactment relied upon
by it is a special statute and the other enactment is general and
also invokes the non-obstante clause contained in the enactment
relied upon.
54. The Rent Control Act makes a departure from the general law
regulating the relationship of landlord and tenant contained in the
Transfer of Property Act inasmuch as it makes provision for
determination of standard rent, it specifies the grounds on which
a landlord can seek the eviction of a tenant, it prescribes the
forum for adjudication of disputes between landlords and tenants
and the procedure which has to be followed in such proceedings.
The Rent Control Act can, therefore, be said to be a special
statute regulating the relationship of landlord and tenant in the
Union Territory of Delhi. The Public Premises Act makes provision
for a speedy machinery to secure eviction of unauthorised
occupants from public premises. As opposed to the general law
which provides for filing of a regular suit for recovery of
possession of property in a competent Court and for trial of such
a suit in accordance with the procedure laid down in the CPC, the
Public Premises Act confers the power to pass an order for
eviction of an unauthorised occupant in a public premises on a
designated officer and prescribes the procedure to be followed by
the said officer before passing such an order. Therefore, the
Public Premises Act is also a special statute relating to eviction of
unauthorised occupants from public premises. In other words,
both the enactments, namely, the Rent Control Act and the Public
Premises Act, are special statutes in relation to the matters dealt
with therein. Since, the Public Premises Act is a special statute
and not a general enactment the exception contained in the
principle that a subsequent general law cannot derogate from an
earlier special law cannot be invoked and in accordance with the
principle that the later laws abrogate earlier contrary laws, the
Public Premises Act must prevail over the Rent Control Act.
....................
62. As mentioned earlier, the Public Premises Act has been
enacted with a view to provide for eviction of unauthorised
occupants from public premises. In the statement of objects and
reasons for this enactment reference has been made to the
judicial decisions whereby by the 1958 Act was declared as
unconstitutional and it has been mentioned:
The court decisions, referred to above, have created serious
difficulties for the Government inasmuch as the proceedings
taken by the various Estate Officers appointed under the Act
either for the eviction of persons who are in unauthorised
occupation of public premises or for the recovery of rent or
damages from such persons stand null and void. It has
become impossible for Government to take expeditious
action even in flagrant cases of unauthorised occupation of
public premises and recovery of rent or damages for such
unauthorised occupation. It is, therefore to considered
imperative to restore a speedy machinery for the eviction of
persons who are in unauthorised occupation of public
premises keeping in view at the same time the necessity of
complying with the provision of the Constitution and the
judicial pronouncements, referred to above.
This shows that the Public Premises Act has been enacted to deal
with the mischief of rampant unauthorised occupation of public
premises by providing a speedy machinery for the eviction of
persons in unauthorised occupation. In order to secure this object
the said Act prescribes the time period for the various steps
which are required to be taken for securing eviction of the
persons in unauthorised occupation. The object underlying the
enactment is to safeguard public interest by making available for
public use premises belonging to Central Government,
Companies in which the Central Government has substantial
interest, Corporations owned or controlled by the Central
Government and certain autonomous bodies and to prevent
misuse of such premises.
...
It has been urged by the learned Counsel for the petitioner that
there is no conflict between the provisions of the Rent Control Act
and the Public Premises Act and that both the provisions can be
given effect to without one overriding the other. In this regard, it
has been pointed out that since no provisions has been made in
the Public Premises Act for the termination of the lease, the
provisions of the Rent Control Act can be held applicable upto the
stage of termination of the lease, and thereafter, proceedings can
be initiated for eviction under the provisions of the Public
Premises Act. In support of this submission, reliance has been
placed on Dhanpal Chettiar's case (supra), wherein it has been
held that in view of the special provisions contained in the State
Rent Control Acts, it is no longer necessary to issue a notice
under Section 106 of the Transfer of Property Act to terminate
the tenancy because inspite of the said notice the tenant is
entitled to continue in occupation by virtue of the provisions of
the said Acts. In the said case, it has been further laid down that
the relationship between the landlord and tenant continues till
the passing of the order of eviction in accordance with the
provisions of the Rent act, and therefore, for the eviction of the
tenant in accordance with the law, an order of the competent
Court under the Rent Control Act is necessary. This would mean
that in order to evict a person who is continuing in occupation
after the expiration or termination of his contractual tenancy in
accordance with law, two proceedings will have to be initiated.
First, there will be proceedings under Rent Control Act before the
Rent Controller followed by appeal before the Rent Control
Tribunal and revision before the High Court. After these
proceedings have ended they would be followed by proceedings
under the Public Premises Act, before the Estate Officer and the
Appellate Authority. In other words, persons in occupation of
public premises would receive greater protection than tenants in
premises owned by private persons. It could not be the intention
of Parliament to confer this dual benefit on persons in occupation
of public premises.
....
69. For the reasons aforesaid, we are unable to accept the
contention of the learned Counsel for the petitioners that the
provisions contained in the Public Premises Act cannot be applied
to premises which fall within the ambit of the Rent Control Act. In
our opinion, the provisions of the Public Premises Act, to the
extent they cover premises falling within the ambit of the Rent
Control Act, override the provisions of the Rent Control Act and a
person in unauthorised occupation of public premises under
Section 2(e) of the Act cannot invoke the protection of the Rent
Control Act."
18. Now dealing with the first question formulated
above with regard to the applicability of the guidelines issued
by the Ministry of Urban Development, it is only after the
above said judgment of the Supreme Court and in the
background of the legal position crystallized through the
above judgment, that the Ministry of Urban Development,
Government of India, felt the need and initiated the process
of framing the guidelines to be followed by various Public
Sector Undertakings and Financial Institutions so that they
are prevented from arbitrarily using the provisions of Public
Premises Act to evict genuine tenants. In the case of Nusli
Neville Wadia vs. New India Assurance Co. Ltd
2006(3)MH.L.J decided by the Bombay High Court (which
decision was upheld by the Supreme Court on 13.12.2007 as
reported in (2008) 3 SCC 279) there is a clear reference to a
letter dated 14th January, 1992 written by the Ministry of
Urban Development regarding issuance of such guidelines. It
would be pertinent to reproduce the relevant para here:
"6. Mr. Dada, brought to our notice a letter dated 14th January,
1992 written by the Ministry of Urban Development, Government
of India regarding the issuance of the Guidelines under the Public
Premises Eviction Act with regard to public statutory
undertakings. The said letter was issued pursuant to the Hon'ble
Supreme Court's judgment in the case of Ashoka Marketing
Limited v. Punjab National Bank : [1990]3SCR649 , wherein the
Hon'ble Supreme Court has directed that the proper Guidelines
should be provided to prevent an arbitrary use of the provisions
of the Public Premises Eviction Act to evict the genuine tenants
from the public premises under the control of Public Sector
Undertakings and Financial Institutions. The said letter also
reiterates the observations of the Hon'ble Supreme Court that
every activity of the Public Authority should be guided by public
interest and that they were expected to deal with their tenants
distinctly from that of private landlords. The said letter also
mentions that several representations against the eviction
proceedings have been received by the Ministry for issuance of
Guidelines so that the provisions of Public Premises (Eviction of
Unauthorised Occupants) Act, 1971 are not indiscriminately used
by public statutory organisations to oust the genuine tenants.
The said letter also mentions that it has been decided to
prescribe for the benefit of all these organisations a set of
guidelines in order to prevent use of the provisions of the said
Act to evict genuine tenants and to limit the use of summary
powers primarily to unauthorised occupants and retired
employees. The said letter also proceeds to lay down the broad
guidelines indicating that the said Act should primarily be used to
evict totally unauthorised occupants or illegal subletees or the
employees who have ceased to be in their services and thus
ineligible for occupation of the premises. The said letter also
indicates that the persons who are in lawful occupation of the
premises should not be treated or declared as unauthorised
occupants merely on service of notice of termination of tenancy.
When a genuine tenant is to be evicted, the genuine grounds
available under the Rent Control Act of the State ought to be
utilised for resuming possession."
19. A lot of debate has arisen with regard to the
enforceability of the said guidelines issued by the Ministry of
Urban Development, Government of India in the year 1992
and subsequent various modifications, the last such
guidelines being issued in the year 2002. The Division Bench
of the Bombay High Court in the case of Persis Kothawali
Vs. LIC Mumbai 2004AIHC2613 has very extensively dealt
with the issue of applicability and enforceability of the said
guidelines on the Public Sector Undertakings and Financial
Institutions, especially the LIC. The issue in the said judgment
before the Division Bench of the Bombay High Court was an
astronomical revision of the rent by the respondent LIC in
respect of the tenanted premises in occupation of old tenants.
Challenging the arbitrary, unfair and unreasonable revision of
the rent, the petitioner placed reliance on the said guidelines
issued by the Ministry of Urban Development, Government of
India in the year 2002. The Court traced the history of said
guidelines of 2002 and the following paras from the said
judgment giving brief background of the guidelines are
reproduced as under:-
The learned senior counsel for the petitioner briefly traced the history
of the above guidelines as under:-
(a) On 14th January, 1992, the Ministry of Urban Development,
Government of India had issued detailed guidelines to be followed by
Public Sector Undertakings "so that the provisions of the Public
Premises Act are not indiscriminately used by these organizations to
the detriment of the genuine tenants interest".
(b) The most relevant paragraphs of the said Guidelines are
reproduced hereunder:-
"A person in lawful occupation of any premises should not be
treated or declared to be an unauthorized occupant merely on service
of termination of tenancy, nor should any contractual agreement be
wound up by taking advantage of the provisions of the Act. At the
same time, it will be open to the public authority to secure periodic
revision of rent in terms of the provisions of the Rent Control Act in
each State or to move under genuine grounds under the Rent Control
Act for resuming possession. In other words, the public authorities
would have rights similar to private landlords under the Rent Control
Act in dealing with genuine legal tenants. It is necessary not to give
room for allegations that eviction were selectively resorted to for the
purpose of securing an unwarranted increase in rent, or that a change
in tenancy was permitted in order to benefit particular individual or
institutions in order to avoid such imputations or abuses of
discretionary powers. The release of premises or change of tenancy
should be decided at the level of Board of Directors of the Public
Undertaking".
(c) The above guidelines indicate that an inter-Ministerial meeting of
Central Government was held on 28th August, 1991, to discuss in detail
the question as to the use of the Public Premises Act by Public Sector
Undertakings for the evicting of genuine tenants. It appears that the
Union Cabinet had approved the above guidelines. By a letter dated
20th January, 1992 the Government of India had notified inter alia, the
Chief Executives of Public Sector undertakings of the issue of the 1992
guidelines "for information, guidance and strict enforcement of
instructions contained therein".
(d) Again by ;its letter dated 5th August, 1992, the Government of
India (Ministry of Urban Development) had issued certain clarifications
in respect of the 1992 guidelines, which arose in the light of
discussions held at an inter departmental meeting convened by the
said Ministry on 19th June, 1992 to review the progress of
implementation of the 1992 guidelines. These clarifications appear to
have been issued to various Ministers and it was specifically requested
"that it may be ensured that the guidelines issued by this Ministry with
the approval of the Cabinet in January, 1992 along with the above
clarifications are scrupulously followed by the Public Sector
Undertakings/Govt. departments under the control of your Ministry".
Clarification NO. 3, clarification NO. 6 and clarification NO. 7 are
reproduced hereunder, which are relevant:-
"3. Distinction has to be made between illegal occupation and
unauthorized occupation and the PSU‟s should be allowed to proceed
against unauthorized occupants.
6. The Banks/PSU‟s should be free to evict even authorized tenants if
the premises are required for their own bonafide use including use by
their employees or redevelopment of the premises or business use.
7. Whether the guidelines issued for the public sector undertakings
are uniformally applicable to premises owned by the Government
Departments also.
The public sector undertakings are not expected to start eviction
proceedings against the genuine tenant merely by service of notice
declaring him as unauthorized Occupant so long as he/she does not
vitiate any of the tenancy conditions. The Act should be used by the
PSU‟s mainly to evict those in illegal occupation of the premises or
unauthorized subtenants. Hence there is no conclusion in the
guidelines as interpreted by certain PSU‟s like public sector banks/LIC
etc. Where the tenancy is illegal or where the original tenant has
connived at a breach of tenancy conditions, the PSU is within its rights
to issue a notice under the provisions of law.
Resorting to PPE Act to vacate authorized tenants merely to secure
possession of the premises to accommodate the PSU‟s employees, or
for the commercial redevelopment or to open a branch cannot be
agreed as it will be totally against the spirit of the guidelines for
protecting interests of genuine authorized tenants. The Model Rent
Control Legislation permit revision of present rents to the level of
market rents over a period of and annual indexation of rents. After
the State Government enact the Amendments, on the lines of the
Model Rent Control Legislation, the PSU‟s can secure rent revision
according to the new formula. As such, there is no justification for
seeking eviction or original tenants merely to secure higher rents".
Guidelines issued earlier in respect of public sector undertakings
should also apply in regard to the premises owned by Central
Government Departments.
(e) The 1992 guidelines have been followed by various Public Sector
Undertakings thereafter. However, some undertakings, such as the
first Respondent (LIC) had resorted to indiscriminate increases in rent
and acted in a manner contrary to the 1992 guidelines. When
representations were made to it in that behalf, the Respondent LIC by
its letter dated 15th October, 1997 had denied that it was resorting to
indiscriminate increase in rent and that it had resorted only to enhance
the rents "so as to meet the expenses of maintenance atleast" and
that "every care is taken to see that the guidelines issued by the
Ministry with regard to P.P. Act is strictly adhered to." By its further
letter dated 8th May, 1998 (Exhibit 0-2/page 137), the Life Insurance
Corporation in response to a letter addressed to it by Shri Murli Deora,
Member of the Lok Sabha, has categorically stated that „I may,
however, state that the matters in regard to increase in rent, transfer
of tenancy etc., are being dealt with keeping in mind the very low rent
which is being paid by the tenants as compared to the market rent and
the return which we expect to receive from the state. We do keep in
mind the provisions of the Public Premises Act and the Government
guidelines issued in this behalf."
(f) It appears that by an Office Memorandum dated 7th July, 1993, the
Ministry of Urban Development sought to advice all Ministries to issue
suitable instructions to the PSUs under their control "clarifying that the
guidelines under the P.P. Act are meant for the benefit of genuine non-
affluent tenants and these are not applicable to large business houses
and commercial enterprises" (Exhibit „4‟ to LIC‟s Reply/page 18).
(g) It is vital to note that the above clarification is market
"Confidential". It was not meant to, and did not, receive publicity and
was not intimated to any of the tenants. The learned senior counsel
for the petitioner Mr. Chagia submitted that the so-called clarification
is entirely devoid of any force of law; and furthermore, that it cannot
possibly derogate from the 1992 Guidelines. The purported
clarification is therefore entirely irrelevant to the issue for
determination before this Hon‟ble Court, namely, the applicability of
the Guidelines and their binding force qua LIC.
(h) A letter dated 29th September, 2000 was addressed by the Ministry
of Urban Development seeking the intervention of the Ministry of
Finance for the issue of instructions to Life Insurance
Corporation/Nationalized banks "to strictly adhere to these guidelines
and ensure that the allotment of an accommodation is cancelled and
provisions of the Public Premises Act, 1971 resorted to only in genuine
and legitimate cases and that no genuine tenant should suffer at the
hands of the law".
(i) In response to the aforesaid letter, the Ministry of Urban
Development passed a Government Resolution dated 30th May, 2002,
containing Guidelines to prevent the arbitrary use of powers under the
Public Premises Act, by the PSU‟s, and notified them in the Gazette of
India on 8th June, 2002. The guidelines are substantially the
guidelines of 1992 with certain changes in form and substance which
also disclose application of mind. These 2002 Guidelines, Interalia,
provided as under:-
"2. To prevent arbitrary use of powers to evict genuine tenants from
public premises and to limit the use of powers by the Estate Officers
appointed under Section 3 of the PP(E) Act, 1971, it has been decided
by Government to lay down the following guidelines:-
(i) The provisions of the Public Premises (Eviction of Unauthorized
Occupants) Act, 1971 (P.P. (E) Act, 1971) should be used primarily to
evict totally unauthorized occupants of the premises of public
authorities or sub-letees, or employees who have ceased to be in their
fjameshdji
service and thus ineligible for occupation of the premise:
(ii) The provisions of the P.P. (E) Act, 1971 should not be resorted to
either with a commercial motive or to secure vacant possession of the
premises in order to accommodate their own employees, where the
premises "were in occupation of the original tenants to whom the
premises were let either by the public authorities or the persons from
whom the premises were acquired:
(iii) A person in occupation of any premises should not be treated or
declared to be an unauthorized occupant merely on service of notice of
termination of tenancy, but the fact of unauthorized occupation shall
be decided by following the due procedure of law. Further, the
contractual agreement shall not be wound up by taking advantage of
provisions of the P.P. (E) Act, 1971. At the same time, it will be open
to the public authority to secure periodic revisions of rent in terms of
the provisions of the Rent Control Act in each State or to move under
genuine grounds under the Rent Control Act for resuming possession.
In other words, the public authorities would have rights similar to
private landlords under Rent Control Act in dealing with genuine legal
tenants;
(iv) It is necessary to give no room for allegations that evictions were
selectively resorted to for the purpose of securing an unwarranted
increase in rent, or that a change in tenancy was permitted in order to
benefit particular individuals or institutions. In order to avoid such
imputations or abuse of discretionary powers, the release of premises
or change of tenancy should be decided at the level of Board of
Directors of Public Sector Undertakings.
(v) All the Public Undertakings should immediately review all pending
cases before the Estate Officer or Courts with reference to these
guidelines, and withdraw eviction proceedings against genuine tenants
on grounds otherwise than as provided under these guidelines. The
provisions under the P.P. (E) Act, 1971 should be used henceforth only
in accordance with these guidelines.
20. While dealing with the said guidelines, the
Division Bench also held a discussion on Section 21 of the
Life Insurance Corporation Act which mandates the Life
Insurance Corporation to be guided by such direction in the
matter of policy involving public interest as the Central
Government may give to it in writing. For better
appreciation, Section 21 of the Life Insurance Corporation
Act 1956 is produced as under:-
Section 21:-
"In the discharge of its functions under this Act, the Corporation shall
be guided by such directions in matters of policy involving public
interest as the Central Government may give to it in writing and if any
question arises where a direction relates to a matter of policy involving
public interest, the decision of the Central Government thereon shall
be final."
Besides dealing with the said provision to determine the
question as to whether the said guidelines issued by the
Ministry of Urban Development have a statutory force or not,
the Bombay High Court had also the occasion to examine the
judgment of the Division Bench of the Delhi High Court in the
case of Uttam Prakash Bansal and Ors. vs Life Insurance
Corporation of India and Ors. 2002(100) DLT 297 and
the judgment of the Division Bench of Calcutta High Court in
Mitra Lina Pvt. Ltd. vs. Life Insurance Corporation of
India 1999(2) CLJ 457. It would be relevant to reproduce
the following paras from the said judgment as under:-
65. As far as the first issue is concerned, whether the aforesaid
2002 Guidelines have a statutory force or not, the learned counsel
for the Respondent-LIC has strongly relied upon the judgment of
the Calcutta High Court in the case of Mitra Lina Pvt. Ltyd. V. LIC of
India, 1999 (2) Cal LJ 457 and another judgment of the Delhi High
Court in the case of Shri Uttam Prakash Bhansal v. LILC of India,
2002 (100) Delhi LT 497. In fact the dElhi High Court has merely
referred to te judgment of the Calcutta High Court and has
accepted the view of Calcutta High Court to hold that the aforesaid
Guidelines do not have a statutory force. It is very relevant to
note that in both the above judgments, the respective High Courts
were dealing with the unauthorized occupants who were not even
protected by either the 1992 Guidelines or by 2002 Guidelines. As
observed hereinabove, the Delhi High Court and there is no
separate reasoning as to whether the Guidelines have statutory
force as per Section 21 of the LIC Act. In that context, if one were
to analyse the Calcutta High Court judgment, it is clear that the
Mitra Lina who was the LIC‟s tenant had inducted an illegal licensee
without consent of LIC into the premises. Therefore, the Calcutta
High Court proceeded on the basis that, to evict such an
unauthorized occupant under the Public Premises (Eviction) Act, is
totally alien to the concept of holding acquiring or disposing of any
property under clause (c) of sub-section (2) of Section 6 of the LIC
Act. In both the judgments, i.e. the Calcutta High Court as well as
Delhi High Court, it was categorically held that even if the
Guidelines were binding, the action taken by the LIC was not in
derogation of the Guidelines, since the action was against the
illegal occupants. Therefore, in the present context, we are
concerned with the tenant who is in authorized and recorded
tenant and there is no termination of tenancy and the issue
involved is with regard to the revision and recovery of the rent.
66. As rightly pointed out by Mr. Chagia, Section 21 of LIC Act
contemplates that the directions by the Central Government should
be in writing and such directions should direct the LIC to discharge
its functions and the same should relate to the policy involving the
public interest. In the present case, the Respondent LIC in its
affidavit dated 11th November, 2003 in paragraph No. 4 has clearly
stated "when LIC asked for increased rent in consonance with
State‟s policy, LIC acts in its capacity as a lessor, it is incumbent
on LIC to carry on its business and manage its affairs on sound
commercial principles..." Similarly, in paragraph No.7 in the
affidavit dated 11th November, 2003 in Writ Petition NO. 2516 of
2003, the LIC has also categorically stated that the "overwhelming
public interest and the interests of crores of policy holders requires
us to revise rent of our properties". If that be so, the LIC cannot
turn around and say that they have no statutory force. It would be
rather anomalous when repeatedly the Central Govt. For the last
10 years has been issuing letters, circulars etc. and directing
various public sector undertakings to strictly adhere to the
aforesaid Guidelines and finally the Central Government even
thought it fit to issue a Government Resolution on 30 th May, 2002
and gazette it on 8th June, 2002. In the above, the directions from
Central Government are in writing. The Respondent LIC in its
affidavits has admitted that the increase in rent is part of its
business and also that there was overwhelming public interest to
benefit crores of policy holders. It that be so, all the aforesaid
three criteria contained iin Section 21 of LIC Act have been
complied with, then the said Guidelines will have to have statutory
force. We do not find any substance in the Argument of Mr.
Singhvi that the Guidelines will have to issue only under Section 21
of LIC Act and in the instant case as the Guidelines have not been
issued under Section 21, therefore, they do not have statutory
force. A bare perusal of Section 21 indicates that LIC has to follow
the guidelines issued by the Central Government, while LIC is
discharging its functions under the Act. The aforesaid Section does
not mention that the Central Government will be issuing guidelines
under that section. What is important is that LIC shall be guided
by the directions issued by the Central Government, while LIC is
discharging its functions under the Act. We do not find any
substance that the Guidelines will have to be necessarily issued
under Section 21. Hence we hold that 2002 Guidelines have
statutory force.
67. With regard to the second issue, even assuming for the sake
of arguments that the Guidelines do not have a statutory force, the
same are otherwise very clearly binding on the LIC. The aforesaid
Guidelines reflects the policy of Union of India and any failure to
abide by the Guidelines would be violative of Act. 14 of the
Constitution of India. Especially in the list of the Supreme Court
judgment in the case of Secretary, Ministry of Chemical&
Fertilizers, Govt. of India v. Cipla Ltd. (2003) 7 SCC 1: (AIR 2003
SC 3078), wherein it is held as under:-
4.1 It is axiomatic that the contents of a policy document cannot
be read and interpreted as statutory provisions. Too much of
legalism can not be imported in understanding the scope and
meaning of the clauses contained in policy for maker and the
delegate of legislative power cannot at its sweet will and pleasure
give a goby to the policy guidelines evolved by itself. In the matter
of selection of drugs for price control. The Government itself
stressed on the need to evolve and adopt transparent criteria to be
applied across the board so as to minimize the scope for subjective
approach and therefore, came forward with specific criteria. It is
nobody‟s case that for any good reasons, the policy or norms have
been changed or have become impracticable of compliance. That
being the case, the Government exercising its delegated legislative
power should make a real and earnest attempt to apply the criteria
laid down by itself. The delegated legislation that follows the policy
formulation should be broadly and substantially in conformity with
that policy, otherwise it would be vulnerable to attach on the
ground of arbitrariness resulting in violation of Article 14.
4.2 In Indian Express Newspapers (P) Ltd. v. Union of India (AIR
1986 SC 515, Para 73) the grounds on which subordinate
legislation can be questioned were outlined by this Court E.S.
Venkataramiah, J. observed thus:
"73. A piece of subordinate legislation does not carry the same
degree of immunity which is enjoyed by a statue passed by a
competent legislature. Subordinate legislation may be questioned
on any of the grounds on which plenary legislation is questioned.
In addition it may also be questioned on the ground that it does
not conform to the statute under which it is made.... It may also be
questioned on the ground that it is unreasonable, unreasonable not
in the sense of not being reasonable, but in the sense that it is
manifestly arbitrary. In England, the Judges would say Parliament
never intended authority to make such rules. They are
unreasonable and ultra vires."
68. It is also well settled that even non-statutory guidelines are
enforceable whenever they are deviated from, or deviation is
against public interest or undermines public purpose. Such non-
statutory guidelines can be enforced on the basis of promissory
estoppels and legitimate expectation. In this behalf, it is relevant
to quote the following judgments of the Supreme Court in
Narendra Kumar Maheshwari v. Union of India, 1990 (Supp) SCC
440: (AIR 989 SC 2138, Paras 99 and 100):
106. It may, however, be stated that being not statutory in
character, these guidelines are not enforceable. See the
observations of this Court in G.J. Fernandez v. State of Mysore
(AIR 1967 SC 1753) (Also see R. Abdullah Rowther v. State
Transport Appellate Tribunal (AIR 1959 SC 396); Dy. Asstt. Iron &
Steel Controller v. L. Manekchand, Proprietor (AIR 1972 SC 935).
Andhra Industrial Wroks v. CCI (AIR 1974 SC 1539); K.M.
shanmugam v. S. R.V.S. Pvt. Ltd (AIR 1963 SC 1626). A policy is
not law. A statement of policy is not a prescription of binding
criterion. In this connection, reference may be made to the
observations of Sagnata Investments Ltd. v. Norwich Corpn. (1971
(2) QB 614). Also the observations in British Oxygen Co. v. Board
of Trade (1971 AC 610). See also Foulkes Administrative Law, 6th
edn. At pp. 181-184. In R v. Secretary of State, ex parte Khan
(1985 (1) AII ER 40) the Court held that a circular or self made
rule can become enforceable on the application of persons if it was
shown that it had created legitimate expectation in their minds that
the authority would abide by such a policy/guidelines. However,
the doctrine of legitimate expectation applies only when a person
had been given reason to believe that the State will abide by the
certain policy or guideline on the basis of which such applicant
might have been led to take certain actions. This doctrine is akin
to the doctrine of promissory estoppels. See also the observations
of Lord Wilberforce in IRC v. National Federation (1982 AC 617).
However, it has to be borne in mind that the guidelines on which
the petitioners have relied are not statutory in character. These
guidelines are not judicially enforceable. The competent authority
might depart from these guidelines where the proper exercise of
his discretion so warrants. In the present case, the statute
provided that rules can be made by the Central Government only.
Furthermore, according to Section 6(2) of the Act, the competent
authority has be power and jurisdiction to condone any deviation
from even the statutory requirements prescribed under Sections 3
and 4 of the Act. In Regina v. Preston Supplementary (21975 (1)
WLR 624) it had been held that the Act should be administered
with as little technicality as possible. Judicial review of these
matters, though can always be made where there was arbitrariness
and mala fide and where the purpose of an authority iin exercising
its statutory power and that of legislature in conferring the powers
are demonstrably at variance, should be exercised cautiously and
soberly.
107. We would also like to refer to one more aspect of the
enforceability of the guidelines by person in the positions of the
petitioners in these cases. Guidelines are issued by governments
and statutory authorities in various types of situations. Where
such guidelines are intended to clarify or implement the conditions
and requirements precedent to the exercise of certain rights
conferred in favour of citizens or persons and a deviation therefrom
directly affects the rights so vested the persons whose rights are
affected have a clear right to approach the Court for relief.
Sometimes guidelines control the choice of persons competing with
one another for the grant of benefits, largesses or favours and, if
the guidelines are departed from without rhyme or reason, an
arbitrary discrimination may result which may call for judicial
review. In some other instances (as in the Ramana Shetty case)
(AIR 1979 SC 1628), the guidelines may prescribe certain
standards or norms for the grant of certain benefits and a
relaxation of, or departure from, the norms may affect persons, not
directly but indirectly, in the sense that though they did not seek
the benefit or privilege as they were not eligible for it on the basis
of the announced norms, they might also have entered the fray
had the relaxed guidelines been made known. In other words,
they would have been potential competitors in case any relaxation
or departure were to be made. In a case of the present type,
however, the guidelines operate in a totally different field. The
guidelines do not affect or regulate the right of any person other
than the company applying for consent. The manner of application
of these guidelines, whether strict or lax, does not either directly or
indirectly, affect the rights or potential rights of any others or
deprive them, directly or indirectly, of any advantages or benefit to
which they were or would have been entitled. In this context,
there is only a very limited scope for judicial review on the ground
that the guidelines have not been followed or have been deviated
from. Any member of the public can perhaps claim that such of
the guidelines as impose controls intended to safeguard the
interests of members of the public investing in such public issues
should be strictly enforced and not departed from; departure
therefrom will take away the protection provided to them. The
scope for such challenge will necessarily be very narrow and
restricted and will depend to a considerable extent on the nature
and extent of the deviation. For instance, it debentures were
issued which provide no security at all or if the debt-equity ratio is
6000-1 (as alleged) as against the permissible 2:1 (or thereabouts)
a Court may be persuaded to interfere. A Court, however, would
be reluctant to interfere simply because one or more of the
guidelines have not been adhered to even where there are
substantial deviations, unless such deviations are, by nature and
extent such as to prejudice the interests of the public which it is
their avowed object to protect. Per contra, the Court would be
inclined to perhaps overlook or ignore such deviations, if the object
of the statute or public interest warrant, justify or necessitate such
deviations in a particular case. This is because guidelines, by their
very nature, do not fall into the category of legislation, direct,
subordinate or ancillary. They have only an advisory role to play
and non-adherence to or deviation from them is necessarily and
implicity permissible of the circumstances of any particular fact or
law situation warrants the same. Judicial control takes over only
where the deviation either involves arbitrariness or discrimination
or is so fundamental as to undermine a basic public purpose which
the guidelines and the statute under which they are issued are
intended to achieve.
In Dr. Amarjeet Singh Ahluwalia v. State of Punjab, (1975) 3 SCC
503: (AIR 1975 SC 984) Supreme Court held as under:-
9............Now it is true that clause (2) (ii) of the memorandum
dated October 25, 1965 was in the nature of administrative
instruction, not having the force of law, but the State Government
could not at its own sweet-will depart from it without rational
justification and fix an artificial date for commencing the length of
continuous service in the case of some individual officers only for
the purpose of giving them seniority in contravention of that
clause. That would be clearly violative of Articles 14 and 16 of the
Constitution. The sweep of Articles 14 and 16 is wide and
pervasive. These two articles embody the principle of rationality
and they are intended to strike against arbitrary and discriminatory
action taken by the „State‟. Where the State Government departs
from a principle of seniority laid down by it, albeit by administrative
instructions, and the departure is without reason and arbitrary, it
would directly infringe the guarantee of equality under Articles 14
and 16. It is interesting to notice that in the United States it is
now well settled that an executive agency much be rigorously held
to the standards by which it professes its actions to be judged and
it much scrupulously observe those standards on pain of
invalidation of an act in violation of them. Vide the judgment of
Mr. Justice Frankfurter in Vitara v. Seaton (1959 (359) US 535 at
pp. 546-47). This view is of course not based on the equality
clause of the United States Constitution and it is evolved as a rule
of administrative law. But the principle is the same, namely, that
arbitrariness should be eliminated in State action."
Hence, we hold that the aforesaid 2002 Guidelines are in any
event clearly binding on LIC, and Respondent LIC has to follow the
same.
21. Very recently, I also had the occasion to deal with
the issue of applicability and enforceability of the said
guidelines of 2002 in the case of Kamla Bhargava & Anr. vs
Life Insurance Corporation of India & Ors. W.P. (C) No.
12718/2009 decided on 20.1.2011, and after placing reliance
on the observation made in the matter of New India
Assurance Vs. Nusli Neville Wadia 2008(3)SCC 279 this
Court held as under:-
"15.Indisputably, the above guidelines issued by the Central
Government under the Public Premises Act in the matter of
eviction of tenants cannot override the statutory provisions as
they are advisory in nature, the same, however, would not mean
that these guidelines should be ignored blatantly by the
Government or Government Corporations. In New India
Assurance Company (supra), the Apex Court has clearly held
that action of the State in terms of the provisions of the Act
should not be arbitrary, unreasonable or mala fide."
22. The Apex Court in a plethora of judgments has
taken a view that every action of the State or of an
instrumentality of the State must be fair, just and reasonable
and not arbitrary, unfair, unbridled or mala fide. In New
India Assurance Company (Supra) case also the tenancy
of the tenant was terminated whereafter he was declared as
an unauthorized occupant and necessary notices under
Sections 4 and 7 of the Public Premises Act were issued and
without calling upon the lessor to lead evidence, the Estate
Officer called upon the lessee/petitioner to lead evidence first
and challenging such an order of the Estate Officer, the
lessee/petitioner raised an issue that the petitioner could be
asked to give his evidence only after the evidence is led by
the respondent/lessor. In this case also the eviction of the
tenant was sought by the New India Assurance Corporation
based on their bona fide requirement and there also the
Apex Court had the occasion to deal with the said guidelines
of 2002. It would be useful to refer to the following paras
from the judgment of New India Assurance Company Ltd
vs Nusli Neville Wadia & Anr.2008(3) SCC 279 as under:
"21. A tenant of a public premises although ordinarily does not
get any protection from eviction from the tenanted premises
under the provisions of the Maharashtra Rent Control Act, 1999,
it is accepted that the action on the part of the landlord, which is
State within the meaning of Article 12 of the Constitution of India
must in this behalf be fair and reasonable. In other words the
action of the State in terms of the provisions of the Act should
not be arbitrary, unreasonable or mala fide. With that end in view
only, and for determining the legal effect arriving thereunder, the
Central Government had, from time to time, issued several
guidelines. The guidelines so issued are dated 14-1-1992, 5-8-
1992, 7-7-1993, 14-7-1993, 23-7-1993, 9-6-1998, 2-9-2002 and
23-7-2003. In terms of the said guidelines, however, a distinction
is sought to be made between a tenant who is rich or
industrialist, etc. vis-à-vis a person who is poor and uses the
tenanted premises only for his residence as would appear from
the guidelines dated 23-7-2003, the relevant portion whereof
reads as under:
"3. The Government Resolution dated 30-5-2002 embodies the
guidelines dated 14-1-1992 for observance by the public sector
undertakings. However, clarification was issued vide OM No.
21011/790 Pol.1 IV.H.11 dated 7-7-1993 that the guidelines are
meant for genuine non-affluent tenants and these are not
applicable to the large business houses and commercial
entrepreneurs."
22. Issuance of such guidelines, however, is not being controlled
by statutory provisions. The effect thereof is advisory in character
and thereby no legal right is conferred upon the tenant. [See
(Supp) SCC at 508, Narendra Kumar Maheshwari v. Union of
India1; SCC at p. 232, Bhim Singhji v. Union of India2; (SCC
para 31), J.R. Raghupathy v. State of A.P.3; Uttam Parkash
Bansal v. LIC of India and Punjab National Bank v. Lord Krishna
Paper Industries5.]
.................
26. The occupants of public premises may be trespassers, or
might have breached the conditions of tenancy, or have been
occupying the premises as a condition of service, but were
continuing to occupy the premises despite cessation of contract
of service.
27. However, there may be another class of tenants who are
required to be evicted not on any of the grounds mentioned
hereinbefore but inter alia on the ground, which requires proof of
the fairness and reasonableness on the part of the landlord which
may include requirement for its own use and occupation.
28. Furthermore a proceeding may be initiated under Section 4
simplicitor. A composite proceedings may also be initiated both
under Sections 4 and 7 of the Act. In the latter category of cases
the landlord would be required to establish not only the bona fide
need on its part but also quantum of damages to which it may
hold to be entitled to, in the event that an order is passed in
favour of the establishment.
29. Admittedly in these cases two notices for eviction were
issued. If the contention of Mr. Lekhi is correct, the first notice
was not required to be withdrawn and the second notice was not
required to be issued, specifying the grounds on which the
eviction of the respondents were sought for.
30. When an application for eviction is based on such grounds,
which require production of positive evidence on part of the
landlord, in our opinion, it would be for it to adduce evidence
first; more so in a composite application where the evidence is
also required to be led on the quantum of damages to be
determined by the Estate Officer.
.....................
50. Except in the first category of cases, as has been noticed by
us hereinbefore, Sections 4 and 5 of the Act, in our opinion, may
have to be construed differently in view of the decisions rendered
by this Court. If the landlord being a State within the meaning of
Article 12 of the Constitution of India is required to prove fairness
and reasonableness on its part in initiating a proceeding, it is for
it to show how its prayer meets the constitutional requirements
of Article 14 of the Constitution of India. For proper interpretation
not only the basic principles of natural justice have to be borne in
mind, but also principles of constitutionalism involved therein.
With a view to read the provisions of the Act in a proper and
effective manner, we are of the opinion that literal interpretation,
if given, may give rise to an anomaly or absurdity which must be
avoided. So as to enable a superior court to interpret a statute in
a reasonable manner, the court must place itself in the chair of a
reasonable legislator/ author. So done, the rules of purposive
construction have to be resorted to which would require the
construction of the Act in such a manner so as to see that the
object of the Act fulfilled; which in turn would lead the beneficiary
under the statutory scheme to fulfill its constitutional obligations
as held by the court inter alia in Ashoka Marketing Ltd. (supra)."
23. The Apex Court in the case of Jamshed Hormusji
Wadia vs Board of Trustees, Port of Mumbai and Anr.
(2004)3SCC214, while testing the decision of exorbitant
increase in rent of the Bombay Board Trust whether such a
decision is violative of Article 14 of the Constitution of India
being capricious and unfair held in the following paras as
under:-
"14. The Bombay Port Trust is an instrumentality of State and
hence an "authority‟ within the meaning of Article 12 of the
Constitution. (See Dwarkadas Marfatia and Sons v. Board of
Trustees of the Port of Bombay1.) It is amenable to writ
jurisdiction of the court. This position of law has not been disputed
by either party. The consequence which follows is that in all its
actions, it must be governed by Article 14 of the Constitution. It
cannot afford to act with arbitrariness or capriciousness. It must
act within the four corners of the statute which has created it and
governs it. All its actions must be for the public good, achieving the
objects for which it exists, and accompanied by reason and not
whim or caprice.
........................
18. In our opinion, in the field of contracts the State and its
instrumentalities ought to so design their activities as would ensure
fair competition and non-discrimination. They can augment their
resources but the object should be to serve the public cause and to
do public good by resorting to fair and reasonable methods. The
State and its instrumentalities, as the landlords, have the liberty of
revising the rates of rent so as to compensate themselves against
loss caused by inflationary tendencies. They can -- and rather
must -- also save themselves from negative balances caused by
the cost of maintenance, payment of taxes and costs of
administration. The State, as the landlord, need not necessarily be
a benevolent and good charitable Samaritan. The felt need for
expanding or stimulating its own activities or other activities in the
public interest having once arisen, the State need not hold its
hands from seeking eviction of its lessees. However, the State
cannot be seen to be indulging in rack-renting, profiteering and
indulging in whimsical or unreasonable evictions or bargains.
19. A balance has to be struck between the two extremes. Having
been exempted from the operation of rent control legislation, the
courts cannot hold them tied to the same shackles from which the
State and its instrumentalities have been freed by the legislature in
their wisdom and thereby requiring them to be ruled indirectly or
by analogy by the same law from which they are exempt.
Otherwise, it would tantamount to defeating the exemption clause
consciously enacted by the legislature. At the same time the liberty
given to the State and its instrumentalities by the statute enacted
under the Constitution does not exempt them from honouring the
Constitution itself. They continue to be ruled by Article 14. The
validity of their actions in the field of landlord-tenant relationship is
available to be tested not under the rent control legislation but
under the Constitution. The rent control legislations are temporary,
if not seasonal; the Constitution is permanent and an all-time law."
24. In Ashoka Marketing case (supra) while
interpreting the explanation of the unauthorized occupation
contained in Section 2(g) of the Public Premises (Eviction of
Unauthorized Occupants) Act, 1971, the Hon‟ble Apex Court
took a view that the definition of Section 2(g) is in two parts
i.e. first part deals with the occupation of those who entered
the public premises without any lawful authority as well as
occupation which was permissive at the inception but then
later ceased to be so, while the second part of the definition
is inclusive and it covers occupation by those who entered
into the occupation legally under some valid authority but
their such authority either expired or has been determined in
accordance with law. It would be apt to refer to the following
para of the Ashoka Marketing case (supra) as under:-
"30. The definition of the expression „unauthorised occupation‟
contained in Section 2(g) of the Public Premises Act is in two
parts. In the first part the said expression has been defined to
mean the occupation by any person of the public premises
without authority for such occupation. It implies occupation by a
person who has entered into occupation of any public premises
without lawful authority as well as occupation which was
permissive at the inception but has ceased to be so. The second
part of the definition is inclusive in nature and it expressly covers
continuance in occupation by any person of the public premises
after the authority (whether by way of grant or any other mode
of transfer) under which he was allowed to occupy the premises
has expired or has been determined for any reason whatsoever.
This part covers a case where a person had entered into
occupation legally under valid authority but who continues in
occupation after the authority under which he was put in
occupation has expired or has been determined. The words
"whether by way of grant or any other mode of transfer" in this
part of the definition are wide in amplitude and would cover a
lease because lease is a mode of transfer under the Transfer of
Property Act. The definition of unauthorised occupation contained
in Section 2(g) of the Public Premises Act would, therefore, cover
a case where a person has entered into occupation of the public
premises legally as a tenant under a lease but whose tenancy has
expired or has been determined in accordance with law."
Hence, so far the occupation of those persons not backed by
any legal authority or their permissive possession coming to
an end due to the expiry of their employment or on account
of lapse or expiry of the period of such permissive user is
concerned, there can be no difficulty as in all such cases the
onus is on the occupant to show as to how his occupation is
authorized even after the cessation of the employment or on
the lapse or expiry of the period of licence or permissive user
or in a case where the initial occupation itself was
unauthorized. But in all other cases where a person had
entered into occupation legally and under a valid authority by
a creation of tenancy or by any other mode of transfer and
where such like possession would have been otherwise
protected under the State Rent Acts, the State or any other
instrumentality of the State like Public Sector Undertakings,
Financial Institutions etc. would be required to prove fairness
and reasonableness on its part in initiating proceedings
under the Public Premises Act and as per the law laid down
by the Supreme Court in the case of New India Assurance
Company Ltd vs. Nusli Neville Wadia & Anr. (supra) it
would be for these authorities to show as to how they meet
the constitutional requirement of Article 14 of the
Constitution of India.
25. Another judgment of the Apex Court in Syndicate
Bank Vs. Ramachandran & Ors. 2011(1)SCALE368 is of
great significance as there also the Hon‟ble Apex Court had
the occasion to deal with the legality and validity of the said
guidelines. Commenting on the enforceability of the said
guidelines, the Apex Court observed that the guidelines or
the executive instructions which are not statutory in
character are not laws and their compliance thereof cannot
be enforced through courts. The Apex Court also observed
that since the said guidelines were not issued in exercise of
any statutory power under the Public Premises Act or any
other Statute and even then if there are violations of non
compliance with the aforesaid guidelines, the relief claimed
by the bank could not be denied by relying upon such
guidelines. While taking the said view the Hon‟ble Apex
Court clearly held that the aforesaid order should not be
construed as laying down a proposition that the public sector
undertakings and the financial institutions to which the
guidelines were addressed could willfully ignore or violate
the same. The Court also took a view that if the public sector
undertakings and financial institutions are of the view that
any of the guidelines are contrary to the provisions of the Act
or otherwise unworkable or impracticable they can also seek
modification of the guidelines or have their own internal
guidelines. The relevant paras of the said judgment are
reproduced as under:
"4. If any executive instructions are to have the force of statutory
rules, it must be shown that they were issued either under the
authority conferred on the Central Government or a State Government
or other authority by some Statute or the Constitution. Guidelines or
executive instructions which are not statutory in character, are not
'laws', and compliance thereof can not be enforced through courts.
Even if there has been any violation or breach of such non-statutory
guidelines, it will not confer any right on any member of the public, to
seek a direction in a court of law, for compliance with such guidelines.
An order validly made in accordance with a statute (as in this case, the
Public Premises Act), cannot be interfered with, even if there has been
any transgression of any guidelines, except where it is arbitrary or
malafide or in violation of any statutory provision. These are well
settled principles (See: Union of India v. S.L. Abbas : 1993 (4) SCC
357, Chief Commercial Manager, South Central Railway, Secundrabad
v. G. Ratnam : 2007 (8) SCC 212, and State of U.P. v. Gobardhan
Lal : 2004 (11) SCC 402).
5. As the guidelines relied upon in this case were not issued in exercise
of any statutory power under the Public Premises Act or any other
statute, even if there was violation or non-compliance with the
aforesaid guidelines by the Appellant, relief to the Appellant could not
be denied by relying upon the guidelines. To do so would amount to
reading the guidelines into the statute, which is impermissible? The
only 'remedy' of any person complaining of noncompliance with such
guidelines, is to bring such violation, to the notice of a higher
authority. We therefore hold that the enforcement of any right or
exercise of any power by the Appellant, under the Public Premises Act
cannot be set at naught by relying upon or referring to the guidelines
issued by the Central Government.
6. In this case Ramakrishna Pillai was in occupation of the shop in
1961 when the premises was purchased and he continued in such
occupation and paid the rents regularly till 1997. The bank issued a
notice on 5.2.1998 demanding him to vacate the premises as it
required the property for demolition and reconstructions. As the
demand was not met proceedings were initiated for eviction of the
unauthorized occupant by the Estate Officer in the year 2002. The
petition was resisted by the legal heirs of Ramakrishna Pillai, by the
Respondents by contending that (i) the premises was not a public
premises; and (ii) that they had become absolute owners under the
provisions of Kerala Land Reforms Act, 1963. Considerable evidence
was placed before the Estate Officer and ultimately an order of eviction
was passed by the Estate Officer after negativing the contentions of
Respondents. The said order of eviction was affirmed by the Appellate
Authority. The Respondents did not raise the ground of violation of
guidelines either before the Estate Officer or before the Appellate
Authority. It was not even raised in the grounds of revision filed before
the High Court. Reliance was placed on the guidelines for the first time
during arguments in the year 2009 and the High Court proceeded to
grant relief to the Respondents as if the guidelines created a right in
the Respondents to claim review by the Appellant in regard to its
decision to evict them. The High Court has set aside the order of
eviction affirmed by the Appellate Authority solely on the ground that
the bank had not reviewed the pending case as per Para (v) of the
guidelines to find out whether it should be withdrawn, and therefore
the order of eviction should be set aside. The order of the High Court
being contrary to the well settled principles relating to the
enforceability of guidelines, is not sustainable. Even if the High Court
felt that a review under para (v) of the guidelines was necessary, it
could have directed the Appellant to undertake the exercise pending
consideration of the revision petition instead of allowing the revision
and setting aside the order of eviction. At all events, the very fact that
the Respondents claimed ownership in themselves and denied their
relationship and status, should have been sufficient to hold that the
Respondents did not deserve any benefit under the guidelines, even if
they were enforceable.
7. We may however add that this order should not be construed as
laying down a proposition that the public sector undertakings and
financial institutions to whom the guidelines were addressed, could
willfully ignore or violate the same. Whenever any action is proposed
to be taken under the Public Premises Act, the authorities concerned
are bound to keep the said guidelines in view, to the extent possible
on the facts and circumstances of the respective case. If any public
sector undertaking or financial institution is of the view that any of the
guidelines are contrary to the provisions of the Act or otherwise
unworkable or impractical, they can also seek modification of the
guidelines or have their own internal guidelines. What is held in this
case is that an unauthorized occupant or tenant against whom action
is initiated under the Public Premises Act, cannot resist the
proceedings on the ground of noncompliance with the said guidelines."
In the said case before the Apex Court, the appellant was a
Syndicate Bank which had challenged the order passed by
the High Court granting relief to the tenant by setting aside
the order of eviction on the premise that the said guidelines
created a right on the tenant to claim a review with regard to
the decision of eviction taken by them. It is in this
background of the facts of the said case, the Hon‟ble
Supreme Court held that the enforcement to any right
granted by the Statute cannot be set at naught by relying
upon or referring to the guidelines issued by the Central
Government. Taking such a view, the court also clearly
held that these guidelines cannot be willfully ignored or
violated and the authorities are bound to keep the said
guidelines in view, to the extent possible on the facts and
circumstances of the respective case.
26. As already discussed above, so far the respondent
LIC is concerned, they are bound by the mandate of Section
21 of the Life Insurance Act 1956 which clearly envisage
that the Corporation shall be bound by such directions in
the matter of policy involving public interest as the Central
Government may give to it in writing. Certainly, so far the
respondent LIC is concerned it cannot take a plea that the
said guidelines issued by the Government read with Section
21 of the LIC Act have no binding effect or the same can be
ignored as if they do not exist.
27. It would be relevant to mention here that in the
case of Kamla Bhargava(supra) also where I had the
occasion to deal with somewhat similar case wherein also
the order of the Estate Officer and of the Appellate Court was
under challenge in the writ petition filed by the legal heirs of
an old tenant in occupation of the portion of the same
building involved in the present case i.e. Tropical Building, H
Block, Connaught Circus, New Delhi and this Court after
placing reliance on the above cited judgment of the Apex
Court in New India Assurance Company Ltd. vs Nusli Neville
Wadia & Anr (supra) and in Dwarkadas Marfatia and Sons vs
Board of Trustees of the Port of Bombay (1989) 3 SCC 293
held as under:-
"13.The above observations were reiterated by the Apex Court in
the case of New India Assurance vs. Nusli Neville Wadia
2008(3) SCC 279 where augmenting the legal position in
Dwarkadas(Supra), it further held that the landlord being a State
within the meaning of Article 12 of the Constitution of India, it is
not only required to prove fairness and reasonableness on its part
in initiating a proceeding but also for it to show that how its
actions meet the constitutional requirements of Article 14 of the
Constitution of India. In the present case, the petitioners no
doubt are guilty of absenting themselves before the learned
Estate Officer on various dates, but the said guilt of the
petitioners or negligence on their part in comparison with the
guilt and conduct of the respondent looks petty and ignorable.
..................
15. Indisputably, the above guidelines issued by the
Central Government under the Public Premises Act in the matter
of eviction of tenants cannot override the statutory provisions as
they are advisory in nature, the same, however, would not mean
that these guidelines should be ignored blatantly by the
Government or Government Corporations. In New India
Assurance Company (supra), the Apex Court has clearly held
that action of the State in terms of the provisions of the Act
should not be arbitrary, unreasonable or mala fide."
28. I may clarify here that in the said case also the
tenancy of the petitioners was terminated by the respondent
under Section 106 of the Transfer of the Property Act and the
reason given by the Estate Officer under Section 4 of the
Public Premises Act was the alleged bona fide need of the
respondent LIC and the only distinguishing feature in the
facts of the said case with that of the present case is that the
Rent Negotiating Committee of the respondent had taken a
decision to revise the rent of the petitioners which belied the
case of the bona fide need put forth by the respondent LIC. In
the facts of the present case as well, tenancy of the
petitioners was terminated by the respondent under Section
106 of the Transfer of Property Act. There is no other reason
given by the respondent to determine the tenancy of the
petitioners except that of putting forth the same reason of
bona fide use. The premises in occupation of the petitioners
are also part of the same Tropical Building, H-Block,
Connaught Circus, New Delhi. As per the correspondence
placed on record by the petitioners, an offer was made by the
respondent LIC to the petitioners for the surrender of their
tenancy No. 106007 and then for consideration of nominal
increase in respect of other tenancy No. 106008. Without
commenting on the said negotiations, it is quite manifest that
the respondent LIC failed to prove their bonafide need of the
said tenanted premises for their own use or for the use of
their employees. In the notice sent by the respondent under
Section 106 of the Transfer of Property Act, the respondent
has failed to spell out their alleged bona fide need and
similarly in the show cause notice sent by the Estate Officer
under Section 4 of the Public Premises Act, the alleged bona
fide need has not been specifically spelt out. Likewise even in
the evidence adduced by the respondent through one Mr.
Ajay Kanth, posted as Branch Inspector in the said
Department there is a vague deposition that the premises are
required for bona fide use for the officials of the respondent
LIC and the said case of the bona fide requirement got
completely shattered when the said witness of the LIC in his
cross-examination deposed that he cannot say as to what the
bona fide requirement of the respondent LIC was, as the
same would be for the concerned officers to decide. The
learned Estate Officer and similarly the Appellate Court had
nowhere discussed the failure of the respondent to prove
their bona fide need to seek eviction of the petitioners from
the tenanted premises under their occupation. Both the
Courts below have given a lot of thrust to the termination
notice served by the respondent under Section 106 of the
Transfer of Property Act without caring to deal with the vital
aspect of determining as to whether the action of the
respondent being an instrumentality of the State was fair,
honest, genuine and justified on the touchstone of Article 14
of the Constitution of India or not.
29. The husband of the petitioner was an old tenant in
respect of both the said premises and the said tenancy
devolved upon the present petitioners after his death and the
petitioners were accepted as tenants by the respondent LIC.
It is not in dispute that the petitioners have been regularly
paying the rent of the said tenanted premises under their
occupation and the termination of the tenancy of the
petitioners was not on account of any kind of default by the
petitioners in the payment of the rent. The tenancy of the
petitioners was terminated by the respondent on the ground
of bona fide need of the respondent. The respondent has
miserably failed to prove their bona fide need to seek eviction
of the petitioner from the said tenanted premises. Following
the judgment of the New India Assurance Company Ltd.
(supra) the action of the respondent in seeking eviction of
the petitioners does not meet the Constitutional mandate of
Article 14 of the Constitution of India. The action of the
respondent does not satisfy the requirements of the test of
fairness, reasonableness, which are the basic postulates of
Article 14 of the Constitution of India and rather the action of
the respondent appears to be totally arbitrary and capricious.
30. The respondent-Life Insurance Corporation of
India is an instrumentality of the State and there cannot be
any dispute that the actions taken by the respondent-Life
Insurance Corporation against any of its lessee/sub-lessee or
its employees must not be unreasonable, whimsical, unfair,
unjust or tainted with arbitrariness or capriciousness. The
Life Insurance Corporation cannot be heard to say that the
guidelines of 2002 issued by the Ministry of Urban
Development are not of any binding force, as through the
said guidelines the Government has sought to achieve a
special objective i.e to protect the original and genuine
tenants. The said guidelines did not come in the way of these
Government bodies to seek eviction of totally unauthorized
occupants or subletees or those employees who have ceased
to be in their service. The guidelines further mandate that
the provision of P.P. Act may not be resorted to by these
Government instrumentalities with a commercial motive or to
secure vacant possession of the premises in order to
accommodate their own employees where such premises
were in occupation of the original tenants. It further states
that a person in occupation of any premises should not be
treated or declared to be unauthorized merely on service of
notice of termination of tenancy. So far the revision of rent is
concerned, these public authorities have been permitted to
secure periodic revision in terms of the provisions of the Rent
Control Act applicable in each State and no reasons have
been advanced by counsel for the respondent as to why these
guidelines should be ignored when actions are contemplated
against the original and genuine tenants.
31. In the light of the above discussion, I find merit in
the present writ petitions filed by the petitioners and the
same are accordingly allowed and as a result thereof the
order passed by the learned Estate Officer dated 18.04.2006
and the impugned orders dated 22.05.2007 and 29.10.2009
are hereby set aside.
July 25, 2011 KAILASH GAMBHIR, J
