present matter (O.P.(R.C.) No. 16/2025 - Vadavathi Rajeevan &
Anr. vs. K. Vanaja & Anr.). The Division Bench found itself in
Division Bench dated 25.11.2024 passed in O.P.(R.C.) No.
154/2024 (Koorantakath Kamaludeen vs. Kannyath Divakaran),
2. The Full Bench presided over by the Hon'ble the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
provisions and judgments relied upon by them.
2.1. The moot question to be considered, addressed, and
(ii) Whether it is subject to automatic variation, amenable to
constant modification depending upon changes in the status
of the concerned local authority or body, such as from
Panchayat to Municipality or Municipal Corporation, or upon
delimitation of the territories of a Panchayat, Municipality, or
Municipal Corporation.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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Necessary facts leading to the present reference:
3. We find it condign to briefly spell out the relevant
facts in a nutshell. The Kerala State Legislature enacted the
Kerala Buildings (Lease and Rent Control) Act in the year 1959,
which was brought into force in 1965 after receiving the
Presidential assent under Article 254 of the Constitution of
India. The Presidential assent was necessitated since certain
provisions of the Rent Act were in partial conflict with the
provisions of the Transfer of Property Act, 1882 (for short,
"the TPA"), a Parliamentary enactment. Therefore, in order to
overcome the inconsistency between the Central and State
enactments, Presidential assent was sought and granted,
whereafter the Rent Act was enforced throughout the State.
3.1 In terms of Section 1(2) of the Rent Act, Schedule I
was appended to the enactment, enumerating various
Panchayats and Municipalities in different districts of the
erstwhile State of Kerala to which the provisions of the Act
were made applicable. We shall advert to the provisions of the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..4..
Rent Act in greater detail a little later. It is relevant to note
that the name of "Koothuparamba Panchayat", to which the
present dispute pertains, was included at Serial No. 60 under
the District of Cannanore.
3.2 Thereafter, with effect from 05.03.1990,
Koothuparamba Panchayat was upgraded and declared a
Municipality under the provisions of the Kerala Municipality
Act, 1960, (for short, 'Municipality Act') consequent upon the
issuance of the requisite notifications. The conversion into a
Municipality was effected through two separate notifications,
both dated 05.03.1990, one by which Koothuparamba ceased to
be a Panchayat, and the other by which it was constituted as a
Municipality under the Municipality Act.
3.3 Pertinently and admittedly, no notification
modifying or amending Schedule I under Section 1(3) of the
Rent Act has been issued by the State Government till date.
4. It is also an admitted fact that Schedule I to the Rent
Act has not been amended insofar as Entry No. 60 is concerned,
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..5..
and that the name "Koothuparamba Panchayat" continues to
be retained therein, which has perhaps given rise to the
present dispute. We are, therefore, required to consider
whether, once an area has been notified and included in
Schedule I under Section 1(2) of the Rent Act, a further
amending or clarificatory notification under Section 1(3) is
required to modify the description of the entry from
"Koothuparamba Panchayat" to "Koothuparamba Municipality",
consequent upon its conversion from a Panchayat to a
Municipality.
4.1 We are also called upon to examine whether, in the
absence of such an amending or clarificatory notification, the
provisions of the Rent Act cease to apply to the territorial area
of Koothuparamba, which continues to be shown in Schedule I
under the description of Koothuparamba Panchayat.
5. The petitioners, who are tenants, suffered a decree
of eviction in the eviction proceedings instituted by the
landlords, the respondent-plaintiffs. Thereafter, before the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..6..
Executing Court, the petitioners raised a plea that the eviction
proceedings under the provisions of the Rent Act were not
maintainable. The Executing Court overruled the said
objection, holding that the Rent Act was applicable. Aggrieved
thereby, the matter was carried before this Court, raising a
substantial question relating to the applicability of the Rent
Act to the newly constituted Koothuparamba Municipality.
5.1 The petitioners relied upon the judgment of a
Division Bench of this Court in Koorantakath Kamaludeen
(supra), contending that once Koothuparamba Panchayat
ceased to exist and assumed the status of a Municipality, the
eviction proceedings ought to have been instituted before the
regular Civil Court and not before the Rent Control Court (for
short, "RCC").
5.2 However, the submissions advanced on behalf of
the petitioners did not find favour with the Division Bench,
which took a prima facie view that the decision in Koorantakath
Kamaludeen (supra) appears to run contrary to the provisions
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..7..
of the Rent Act. The Division Bench was further of the view
that once an area is notified in Schedule I to the Rent Act, a
subsequent change in its status is of no consequence for the
purposes of the Act, unless the area is expressly excluded by a
separate notification or exempted under Section 25 of the Rent
Act.
5.3 The Division Bench also opined that the judgment
in Koorantakath Kamaludeen (supra) may have been rendered
without a proper scrutiny of the legal effect of Section 1 of the
Rent Act, and it was in the said circumstances that the matter
was referred to this Full Bench.
Statutory provisions involved in the present matter:
6. The Kerala State Legislature enacted the Rent Act in
the year 1959 with the object of regulating the leasing of
buildings and controlling rents in respect of such leased
buildings. One of the principal aims and objects of the Act was
the prevention of unreasonable eviction of tenants from
rented premises within the State of Kerala. As aforestated,
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..8..
Presidential assent under Article 254 of the Constitution of
India was received on 14.05.1965, and only thereafter could the
Rent Act be enforced throughout the State.
6.1 Section 1 of the Rent Act, titled "Short title,
application, commencement and duration", reads as follows:
"1. Short title, application, commencement and
duration.-
(1) This Act may be called the Kerala Buildings (Lease and
Rent Control) Act, 1959.
(2) lt applies to the areas mentioned in the Schedule.
(3) The Government may, by notification in the Gazette, apply
all or any of the provisions of this Act to any other area in the
State with effect from such date as may be specified in the
notification and may, by like notification, cancel or modify
such notification or withdraw the application of all or any of
the provisions of this Act from any area to which this Act
applies under sub-Section (2):
Provided that no such notification shall be issued unless it is
supported by a resolution passed by the local authority or
authorities, if any, of the areas affected by the notification.
(4) lt shall come into force on the 3rd day of April 1959 and
remain in force up to and inclusive of the 31st day of March
1962."
(emphasis supplied)
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..9..
7. Section 2, which is the definition clause, defines
terms such as "building", "landlord", "tenant", and other allied
expressions. However, the Act does not define the terms
"Panchayat" or "Municipality" anywhere therein.
7.1 Section 11, titled "Eviction of tenants", imposes an
embargo on the eviction of a tenant, whether in execution of
a decree or otherwise, except in accordance with the
provisions of the Rent Act. A tenant may be evicted only on an
application made by the landlord under Section 11(2) before
the RCC, on specified grounds such as non-payment of rent,
bona fide requirement of the building for the landlord's own
occupation, or for such other purposes as enumerated under
Section 11(4). Sections 11(5), 11(7), 11(8), and 11(9) provide for
other contingencies under which eviction of a tenant may be
ordered.
7.2 Under Section 18, a statutory right of appeal is
conferred upon any person aggrieved by an order of the RCC,
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..10..
to the authority notified as the Appellate Authority under the
Rent Act. Section 24 prescribes a time frame of four months
for the disposal of applications or proceedings instituted
under the Rent Act.
7.3 Section 36, titled "Repeal", provides for the repeal
of various enactments upon the coming into force of the Rent
Act, including the Travancore-Cochin Buildings (Lease and
Rent Control) Order, 1950, the Madras Buildings (Lease and
Rent Control) Act, 1949, and the Kerala Buildings (Lease and
Rent Control) Ordinance, 1959, among others.
7.4 As stated supra, Schedule I to the Rent Act
enumerates various villages, Panchayats, and Municipalities
as the areas to which the provisions of the Rent Act apply. It
has been submitted at the Bar that at the time of the
enactment of the Rent Act in 1959 (which came into force in
1965), the State of Kerala comprised nine districts, whereas as
on date, the number of districts has increased to fourteen,
consequent upon reorganisation of districts, delimitation of
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..11..
territorial boundaries, and the transition of villages,
Panchayats, and Municipalities from one district to another.
7.5 By way of illustration, Manjeri Municipality, which
was earlier part of Kozhikode District, is now part of
Malappuram District, and Kasaragod Municipality, which was
earlier within Kannur District, has since become part of an
independent Kasaragod District. However, from the
submissions advanced by all parties, the Court has been
apprised that Schedule I to the Rent Act continues to remain
unamended and unaltered in its form and content.
8. The provisions of the Kerala Panchayat Raj Act,
1994 (for short, "the Panchayat Act, 1994") may be adverted to at
this juncture. The said Act was enacted pursuant to the
Seventy-third Constitutional Amendment Act, 1992. Reference
is made to this enactment since considerable emphasis was
laid by the petitioners on the contention that the constitution
and governance of Panchayats and Municipalities are
regulated by special enactments, namely, the Panchayat Act,
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..12..
1994 and the Municipality Act, respectively.
8.1 Under Section 2(ii), "Block Panchayat" of the
Panchayat Act, 1994 is defined as a Panchayat constituted at
the intermediate level under Section 4(1)(b). Section 2(xii)
defines "District Panchayat" as a Panchayat constituted at the
district level under Section 4(1)(cc), and the District Panchayat
area is referable to the areas notified by the Government for
the purposes of Section 4(1)(c) of the Panchayat Act 1994.
Likewise, "Panchayat" is defined under Section 2(xxv) to mean
a Village Panchayat, Block Panchayat, or District Panchayat,
and the Panchayat area denotes the area falling within the
territorial jurisdiction of such Panchayat.
8.2 Chapter III, titled "Constitution of Panchayats at
different levels", empowers the State Government to constitute
Panchayats and to specify their names and headquarters by
notification published in the Gazette. Under Section 4(1)(a),
the Government is empowered to constitute a Village
Panchayat for each village or for a group of villages, by
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..13..
specifying the villages falling within such Village Panchayat.
Similarly, Panchayats may be constituted at the intermediate
level (Block Panchayat) and at the district level (District
Panchayat).
8.3 Further, under Section 4(2), the Government is
empowered to increase, diminish, or otherwise alter the area
of any Village Panchayat, as well as to change its headquarters.
Section 5 provides for the incorporation and administration of
Panchayats.
9. Likewise, the Municipality Act was enacted
pursuant to the Seventy-fourth Constitutional Amendment
Act, 1992, on lines similar to the Panchayat Raj Act, 1994. The
said Act provides for the constitution of Municipalities of
various categories in the urban areas of the State of Kerala.
9.1 Section 2, which is the definition clause, defines
"local authority" under Section 2(21) to mean a Municipality
constituted under Section 4 of the Municipality Act, or a
Panchayat constituted under the Panchayat Raj Act, 1994.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..14..
9.2 Chapter II, titled "Constitution, alteration and
conversion of Municipalities", contains the provisions relating to
the constitution, alteration, and conversion of Municipalities.
Section 4, titled "Constitution, alteration and conversion of
Municipalities", is the charging provision under which various
categories of Municipalities are brought into existence by
notification issued by the State Government, and reads as
follows:
"4. CONSTITUTION, ALTERATION AND CONVERSION OF
MUNICIPALITIES.--
(1)The Government shall, by notification in the Gazette,
constitute with ef ect from such date as specified in the
notification, -
(a) a "Town Panchayat" for a transitional area;
(b) a "Municipal Council" for a smaller urban area; and
(c) a "Municipal Corporation" for a larger urban area, and
specify the name of such Municipalities.
(2) The Government may, by notification,-
(a) exclude any municipal area from the operation of this act;
or
(b) exclude from a municipal area comprised therein and
defined in the notification ; or
(c) divide any municipal area into two or more municipal
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..15..
areas; or
(d) unite two or more municipal areas; or
(e) unite the territorial area of a Panchayat geographically
lying adjacent to a Municipal area, with the Municipality; or
(f) convert a Village Panchayat into a 5 6[Town Panchayat
or a Municipal Council]; or
(g) convert a Town Panchayat into a Municipal Council; or
(h) convert a Municipal Council into a Municipal Corporation:
[Provided that, before issuing such a notification the
requirements under Article 243 Q and sub- section (1) shall be
fulfilled and the suggestions and opinions of the Village
Panchayat or Town Panchayat or Municipal Council or
Municipal Corporation concerned, shall be considered.]
Provided further that any notification issued under this sub-
section shall not be brought into force except in such a way
as to coincide with the expiry of the term of the existing
Municipal Council or Village Panchayat in that territorial
area.
(3) The Government may at the request of a Municipality or
after consultation with the Municipality, at any time, alter
the name of a Municipality, after previous publication of the
proposal by notification in the Gazette.
(4) Where any Village Panchayat area is constituted as, or
included in, a 7 [Municipality], the Government may pass
such orders as they may deem fit as to the transfer to the
Municipality or disposal otherwise of the assets or
institutions of such Panchayat in that area, and as to the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..16..
discharge of the liabilities if any, of such Panchayat
relating to such assets or institutions.
(5) Where any village Panchayat area is constituted as, or
included in a 8 [Municipality], all taxes, fees or other charges
levied in that area under the enactments or regulations then
in force shall, from the date of constitution or inclusion, as
the case may be, cease to have effect and all such taxes, fees
or other charges shall be levied in that area in accordance
with the provisions of this Act and the rules, regulations and
bye-laws made thereunder.
(6) Where a Municipality is abolished, this Act and all
notifications, rules, regulations, bye-laws, orders,
directions and powers issued, made or conferred under
this Act shall cease to apply to the area comprised within
the Municipality, the balance of the Municipal fund and
all other property vested in the Municipality at the time
of its abolition shall vest in the succeeding local authority
coming into existence or if a local authority does not
come into existence in that area, in the Government and
the liabilities of the Municipality shall be transferred to such
local authority or as the case may be, the Government.
(7) All funds and property vested in the Government under
sub-section (6) shall be applied to discharge the liabilities
transferred to the Government under that sub-section and for
the promotion of the safety, health, welfare or convenience
of the inhabitants of the area comprised in the Municipality."
(emphasis supplied)
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..17..
10. From the above, it is clear that "Municipality" is a
generic term, referable to three categories of local authorities
governing urban areas, namely, a Town Panchayat, a
Municipal Council, and a Municipal Corporation. Under the
Kerala Municipality Act, the State Government is vested with
the power to notify the area falling within a municipal area, to
include or exclude areas from an existing Municipality, or to
alter the boundaries of any Municipal Council.
10.1 The State Government is also empowered to
convert a Town Panchayat into a Municipal Council, and a
Municipal Council into a Municipal Corporation, in exercise of
the powers conferred under Section 4(g) and Section 4(h), as
referred to above.
10.2 Sections 4(4) and 4(5) of the Municipality Act
provide for the consequences arising when the area of a
Village Panchayat is included in a Municipality, including the
transfer of all assets and liabilities of the Panchayat to the
Municipality, the cessation of all taxes, fees, and other
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..18..
monetary levies under the Kerala Panchayat Raj Act, and the
imposition of taxes, fees, and other monetary dues under the
Kerala Municipality Act.
10.3 Section 4(6) of the Municipality Act goes a step
further and provides that wherever a Municipality is abolished,
all notifications, rules, regulations, by-laws, and other
instruments issued in relation thereto shall cease to apply to
the area comprised within such Municipality with immediate
effect.
11. The provisions of the Panchayat Act, 1994 and the
Municipality Act have been referred to for a specific purpose,
viz., in view of the extensive submissions made on behalf of the
petitioners regarding the impact of alteration, conversion, or
change in the status of a Panchayat to a Municipality, or from
one Municipality to another, on the provisions of the Rent Act,
particularly the entries in Schedule I. We shall briefly advert
to these submissions and deal with the issues arising
therefrom in a separate section of the present judgment.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..19..
Contentions of the parties:
12. Both sides relied upon judgments of Single Judges
as well as Division Benches to fortify their respective
submissions, which were in direct conflict regarding the
impact of the conversion of a Panchayat into a Municipality
and its effect on the provisions of the Rent Act.
Counsel for the petitioners contended broadly as follows:
(a) The judgments in Koorantakath Kamaludeen (supra), as
well as Biyathu v. Abdurahimankutty 1 , and Karam Veettil
Parukutty Amma v. Muhammedkutty2, have conclusively held
that, in view of the proviso to Section 1(3), the issuance of a
fresh notification safeguarding the applicability of a
previously existing notification is necessarily required to
ensure the continued applicability of the Rent Act. Once a
Panchayat is converted into a Municipality, or its status is
otherwise altered by the decision of the State Government
1995 SCC OnLine Ker 45
2012 SCC OnLine Ker 29706
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..20..
under the provisions of the Panchayat Act or the Municipality
Act, it becomes obligatory for the State Government to amend
and modify Schedule I of the Rent Act so as to extend the
applicability of the Rent Act to the newly notified and
constituted Municipality in place of the old Panchayat.
(b) Consequently, once a Panchayat is included in or notified
as a Municipality, the Rent Act will not automatically apply to
the newly constituted entity. The applicability of the Rent Act
will remain suspended until a fresh notification is issued and
Schedule I is amended, even if the area was previously
specified in the Schedule.
(c) The landlord-plaintiff (respondent herein) has not placed
on record any fresh notification or document demonstrating
that the Rent Act has been made applicable to the newly
constituted Municipality arising from the old Panchayat area.
In the absence of such a notification, no presumption can be
raised regarding the applicability of the Rent Act ipso facto.
(d) In view of Section 4(2) of the Panchayat Act 1994 and
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..21..
Section 4 of the Municipality Act, the resolution of the
Panchayat or local authority and consultation with the State
Government are necessary for the conversion of a Panchayat
into a Municipality. The Government cannot exercise this
power automatically, without a resolution of the Panchayat or
without consulting it. Consequently, once a Panchayat is
converted into a Municipality, for all practical purposes, the
Panchayat ceases to exist, even for the purposes of the Rent
Act. If the Government thereafter intends to apply or extend
the applicability of the Rent Act, issuance of a fresh
notification under Section 1(3) is necessitated.
Counsel for the respondents contended broadly as follows:
13. The respondents, on the other hand, place reliance
upon the judgment of the Division Bench of this Court in
Meenakshy v. R. Ananthambal and others 3 , to contend as
follows:
2014 SCC OnLine Ker 28721
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..22..
(a) It is not the Panchayat itself that is notified under
Schedule I to the Rent Act, but rather an 'area'
determined on the date of issuance of the Schedule.
The said determined area, with its geographical limits
and territorial boundaries, does not cease to exist or
get affected even if the status of the notified Panchayat
is subsequently converted into a Municipality.
(b) Schedule I to the Rent Act relates to the extension and
applicability of the Act over a defined geographical
area with its territorial limits. At the time the Rent Act
was introduced, the Kerala Panchayats Act, 1960 was in
force, wherein "Panchayat area" was defined under
Section 2(21) as any local area declared as such by the
Government or the relevant authority. The villages or
municipalities mentioned in Schedule I under the 1960
Panchayats Act were included in the districts as
specified therein on that day. Admittedly, there is no
material to show that this situation has been altered by
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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any amendment or modification of Schedule I.
Therefore, the subject matter of Schedule I of the Rent
Act is not the Panchayats or Municipalities per se, but
the geographical area with its territorial limits as
existing on the date of notification of Schedule I.
(c) Even if the State Government undertakes any
delimitation exercise or upgradation of a Panchayat to
a Municipality under the provisions of the Panchayat
Act 1994 or the Municipality Act, such changes will not
affect the validity or efficacy of the geographical limits
already specified in Schedule I of the Rent Act.
Schedule I cannot be regarded as co-terminus with, or
dependent upon, the modifications or alterations of
territories under the Panchayat Act or the
Municipality Act; rather, it remains unaffected and
unaltered by such exercises.
(d) Having received the Presidential assent under Article
254 of the Constitution of India, the Rent Act prevails
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..24..
over all other State enactments and, in respect of
overlapping or similar subject matter, also overrides
the provisions of the Panchayat Act or the Municipality
Act, to the extent matters relating to landlord-tenant
relationships, rent control, or eviction are concerned.
14. Accordingly, the respondents contend that the plea
of inapplicability of the Rent Act has no basis and is therefore
liable to be rejected.
Consideration of submissions by this Court:
15. Having heard both parties to the lis, it is apposite to
first analyse the statutory scheme of the Rent Act and its
correlation with the Panchayat and Municipality Acts of
Kerala. However, it must be noted that, although the Rent Act
was enacted in 1959, it could be enforced only in 1965, as stated
earlier. The Presidential assent was necessitated in view of an
apparent conflict with the provisions of the TPA, particularly
those relating to lease and determination of lease by the lessor
or lessee.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..25..
16. At the relevant point in time, the Kerala Panchayat
Raj Act, 1960, and the Kerala Municipalities Act, 1960, were in
force, and the 'Panchayat area' and 'Municipality area' were as
notified under the respective enactments across the nine
districts of the State. Under Section 2(21) of the Panchayat Act,
1960, the Panchayat area was defined as the area so notified by
the State Government, and similarly, under Section 4 of the
Municipality Act, 1960, the Municipality area was the area
notified by the State Government with its geographical
boundaries under the respective enactments.
16.1 Consequently, the concept of "Panchayat area" and
"Municipality area" was incorporated into Schedule I of the
Rent Act, by deemed inclusion of their notified territories as
various 'areas' under Section 1(2). There is therefore no cavil
or doubt that the references to the terms "Panchayat" and
"Municipality" in Schedule I, covering areas under the nine
districts, were adopted verbatim from the erstwhile
Panchayat and Municipality enactments.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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17. It is well-settled law that once a State enactment
receives the Presidential assent under Article 254 of the
Constitution of India, it assumes a superseding character over
the central or Parliamentary enactment to the extent of any
repugnancy, which is precisely the reason the Presidential
assent is constitutionally required. Simultaneously, by virtue
of having obtained the Presidential assent, such an enactment
also becomes a special enactment in relation to the subject
matter, purpose, scope, and ambit for which it is enacted.
i.) Scheme of Sec. 1(2) &(3) & Proviso to Sec. 1(3) of the Rent
Act
18. The subject matter of applicability of the Rent Act
is not any Panchayat or Municipality per se, but the 'area'
specified in Schedule I, as provided under Section 1(2).
Therefore, the precondition for the enforcement and
applicability of the Rent Act is the specification of an area
along with the notification of the Schedule under Section 1(2).
In other words, even if Section 1(3) had not been enacted, and
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..27..
only Section 1(2) existed on the statute book, it would not have
adversely affected or stultified the operation of the Rent Act.
18.1 Section 1(3) serves merely as a procedural provision
relating to the applicability of the Rent Act. Under this section,
if any area is to be added, modified, or withdrawn, it can occur
only by way of notification and not otherwise. The proviso to
Section 1(3) has a limited scope and cannot affect the
operation of Section 1(2).
18.2 A careful reading of Section 1, particularly Sections
1(2) and 1(3), reveals a clear distinction between the two
provisions. Section 1(2) is the charging provision of the Rent
Act, which applies and extends its operation to all areas
mentioned in the Schedule. Section 1(3), through the phrase
"to any other area in the State with effect from such date", functions
as a superstructure on the foundation of Section 1(2). It
empowers the State Government to extend the operation of
the Rent Act to additional areas, or to cancel, modify, or
withdraw the applicability of the Act from any area where it is
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..28..
already in force.
18.3 Thus, the foundation of the Rent Act is defined by
Section 1(2), under which, once an area is specifically
mentioned in the Schedule, the Act automatically becomes
applicable to that area. Any addition, modification,
cancellation, or withdrawal of an area after the notification of
the Schedule requires a separate notification issued by the
State Government, which would then have the effect of
altering, amending, or modifying the Schedule as codified
under Section 1(2).
19. The proviso to Clause (3) of Section 1 requires the
prior consent of the local authority before the issuance of a
notification under Clause (3). This proviso operates solely
within the scope of Clause (3) and cannot subsume or affect
the operation of Clause (2), since it is a proviso to Clause (3)
and not a proviso to Clause (2). Accordingly, in so far as the
proviso imposes the precondition of obtaining a resolution of
the local authority prior to issuing any notification, it applies
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..29..
only to Clause (3) and not to Clause (2). Our understanding of
the scheme of Section 1 is fortified by the fact that the proviso
is specifically mentioned with Clause (3), and not under Clause
(2), Clause (4), or as a proviso to the entire Section.
20. It is settled law that a proviso to any section cannot
have an ambit, scope, or operation larger than the provision
to which it is appended. A proviso can clarify, qualify, or
restrict the operation of only the main provision to which it is
added, and cannot extend beyond it. The interpretation to be
accorded to a proviso is well-settled by a long line of
precedents and requires no further elaboration.
20.1 A proviso is ordinarily subordinate to the main
section to which it is appended and must always be
interpreted in a manner that ensures harmony with the
principal section as well as other provisions of the statute. It
is generally intended to exercise a part of the main section for
special treatment or to provide a particular course of action
that could not otherwise be adopted in the absence of the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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proviso. For this reason, a proviso cannot extend beyond the
main provision or section, nor can it be construed in a manner
that enlarges the scope of the enactment or transgresses the
boundaries set by the principal section.
20.2 A proviso should not be read in a manner that alters
the operative effect of the main section or other ancillary
provisions of the statute, but must be restricted to the field
covered by the principal provision or section to which it is
appended.
20.3 For these principles, the judgments in Delhi Metro
Rail Corporation Limited v. Tarun Pal Singh & Ors 4, and Satya
Pal Singh v. State of Madhya Pradesh & Ors. 5 have been
referred. In Satya Pal Singh (supra), the Supreme Court
elaborated the manner in which a proviso is to be interpreted,
stating as follows:
"12. It is well established that the proviso of a statute must be
given an interpretation limited to the subject-matter of the
(2018) 14 SCC 161
(2015) 15 SCC 613
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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enacting provision. Reliance is placed on the decision of this
Court rendered by a four-Judge Bench in Dwarka Prasad v.
Dwarka Das Saraf, the relevant para 18 of which reads thus:
(SCC p. 137)
18. A proviso must be limited to the subject-matter of the
enacting clause. It is a settled rule of construction that a
proviso must prima facie be read and considered in relation
to the principal matter to which it is a proviso. It is not a
separate or independent enactment. 'Words are dependent on the
principal enacting words to which they are tacked as a proviso.
They cannot be read as divorced from their context'
(Thompson v. Dibdin³). If the rule of construction is that
prima facie a proviso should be limited in its operation to the
subject-matter of the enacting clause, the stand we have
taken is sound. To expand the enacting clause, inflated by the
proviso, sins against the fundamental rule of construction that a
proviso must be considered in relation to the principal matter to
which it stands as a proviso. A proviso ordinarily is but a proviso,
although the golden rule is to read the whole section,
inclusive of the proviso, in such a manner that they mutually
throw light on each other and result in a harmonious
construction."
(emphasis supplied)
13. Further, a three-Judge Bench of this Court by majority of
2:1 in S. Sundaram Pillai v. V.R. Pattabiraman has elaborately
examined the scope of the proviso to the substantive
provision of the section and rules of its interpretation. The
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..32..
relevant paragraphs are reproduced hereunder: (SCC pp. 607-
08, paras 30, 32-33 & 36-37)
30. Sarathi in Interpretation of Statutes at pp. 294-95 has
collected the following principles in regard to a proviso:
(a) When one finds a proviso to a section the natural
presumption is that, but for the proviso, the enacting
part of the section would have included the subject-
matter of the proviso.
(b) A proviso must be construed with reference to the
preceding parts of the clause to which it is appended.
(c) Where the proviso is directly repugnant to a section,
the proviso shall stand and be held a repeal of the section
as the proviso speaks the latter intention of the makers.
(d) Where the section is doubtful, a proviso may be used
as a guide to its interpretation; but when it is clear, a
proviso cannot imply the existence of words of which
there is no trace in the section.
(e) The proviso is subordinate to the main section.
(f) A proviso does not enlarge an enactment except for
compelling reasons.
(g) Sometimes an unnecessary proviso is inserted by way
of abundant caution.
(h) A construction placed upon a proviso which brings it
into general harmony with the terms of section should
prevail.
...."
(emphasis supplied)
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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21. From the foregoing observations, it is clear that the
enacting clause cannot be expanded or inflated under the
guise of a proviso, as doing so would be contrary to the
fundamental principles of statutory construction. In other
words, the relationship between a section and its proviso can
be likened to that of a wall and plaster: the plaster applies only
to the dimensions and extent of the wall itself. The plaster
cannot exist independently or be applied in mid-air to stand
in a vacuum. It is in this context that the interplay between
Sections 1(2) and 1(3) of the Rent Act must be interpreted,
ensuring that the proviso to Section 1(3) does not extend or
modify the operation of Section 1(2) beyond its intended scope.
22. The proviso, as noted above, is appended to Section
1(3) and not to Section 1(2). The Court is unpersuaded by the
submissions of the petitioners that the proviso must govern
the operation of Section 1(2) as well. When the proviso is
attached solely to Section 1(3), it cannot be extended or read
into Section 1(2). Accordingly, the Court is at a loss to
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..34..
understand how the requirement of a fresh notification with
the consent of the local authority can be invoked merely on a
change of status of a panchayat to a municipality.
22.1 Adopting the interpretation suggested by the
petitioners, or as propounded in Koorantakath Kamaludeen
(supra), would effectively extend the scope of the proviso in
Section 1(3) to govern Section 1(2), which is impermissible.
This crucial aspect, that the proviso is a "plaster on the wall"
of Section 1(3) and not on Section 1(2), was entirely overlooked
by the Division Bench in the said judgment. In fact, there was
no discussion on the effect of Section 1(2) or its correlation
with Section 1(3).
22.2 In light of this inherent discrepancy regarding the
effect and interplay of Sections 1(2) and 1(3), the judgment of
the Division Bench is vulnerable to reconsideration. We
therefore hold that Koorantakath Kamaludeen (supra) has not
correctly interpreted Sections 1(2) and 1(3) of the Rent Act. It
suffers from an inherent fallacy of interpretation, as it
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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erroneously conflates the applicability of the proviso to
Section 1(3) with the operation of Section 1(2), which is legally
impermissible.
23. The moot question, however, remains to be answered,
i.e., the transitional effect of the conversion of a panchayat
into a municipality on an entry as existing under Schedule I of
the Rent Act. Before addressing this question, certain facts, as
gathered from the parties during submissions and from the
Court's own examination, must be set out.
23.1 At the time of the enactment of the Rent Act, there
were nine districts in the State of Kerala: Trivandrum, Quilon,
Alleppey, Kottayam, Ernakulam, Trichur, Palghat, Kozhikode,
and Cannanore. All these districts had municipalities,
panchayats, and villages specified under them in Schedule I. It
has been informed across the Bar that Schedule I has not been
amended since 1965 and continues to exist in its original form.
23.2 However, significant changes have occurred in the
geography and administrative boundaries of Kerala over the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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last 50+ years. As opposed to the original nine districts, there
are now 14 districts, with five new districts being Malappuram,
Idukki, Wayanad, Pathanamthitta, and Kasaragod. A number
of panchayats mentioned in Schedule I have transitioned into
municipalities, and several municipalities have been shifted
from one district to another. Examples include Manjeri
Municipality, previously part of Kozhikode district and now
part of Malappuram district, and Kasaragod Municipality,
previously part of Cannanore and now part of Kasaragod
district.
23.3 Thus, holding that the transitional effect of a
panchayat's conversion into a municipality necessitates a
fresh notification under Sections 1(2) or 1(3) of the Rent Act
would give rise to multiple cascading issues. For instance,
tomorrow, a petition may be filed contending that even the
transfer or transposition of a municipality from one district to
another would require a fresh notification under Sections 1(2)
or 1(3). Similarly, delimitation exercise, undertaken to alter
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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the boundaries or titles of panchayats or municipalities, could
also trigger claims for notification or amendment, as such
exercises may be argued to amount to a "change of status."
23.4 If this approach were adopted, every alteration in
the nature, boundaries, or territorial extent of a panchayat or
municipality under the Panchayat Act or the Municipalities
Act would potentially require fresh notifications and
amendments to Schedule I of the Rent Act, making its
operation impractical and unworkable.
24. Permitting such an interpretation would open a
Pandora's box and would virtually render the implementation
of the Rent Act impossible. It would also provide an easy tool
for tenants to indefinitely stall eviction proceedings, awaiting
a fresh notification of the newly constituted panchayat or
municipality by the State. Clearly, the legislators never
intended such a consequence when drafting and finalizing
Schedule I of the Rent Act.
24.1 If the interpretation urged by the petitioners were
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..38..
adopted, it would lead to unworkable and unmanageable
consequences, effectively paralyzing the implementation of
the Rent Act throughout the State. For all practical purposes,
therefore, such an interpretation would be inconsistent with
the objectives and the laudable purposes for which the Rent
Act was enacted.
ii.) Schedule I is an example of legislation by incorporation &
won't be affected by subsequent changes to panchayats notified
25. There is yet another reason why we are persuaded to
hold that the conversion of a panchayat into a municipality
will not affect the Schedule I of the Rent Act. It is a trite
principle of law that the legislature, while enacting any statute,
often borrows words, phrases, and terminologies from other
primary enactments, from which such terms originate. In the
present case, the mention of 'panchayat' and 'municipality' in
Schedule I has been borrowed from the respective Panchayat
Act and Municipalities Act.
25.1 All parties are in agreement before the Court that
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..39..
the words 'panchayat' and 'municipality' as specified in
Schedule I serve as indicia for determining the areas of
applicability of the Rent Act and were taken from the erstwhile
Panchayat and Municipalities Acts applicable in Kerala.
25.2 Therefore, for the purpose of defining and
determining the areas under its Schedule, the legislature
thought it fit to adopt and incorporate the 'areas' as notified
under the erstwhile panchayat and municipality enactments.
The legislative intent behind this incorporation was to adopt
the geographical boundaries and territories as notified for the
concerned panchayats and municipalities at the relevant point
in time by the State Government. The legislature, by this
method, avoided the need to independently define the areas
and territories, instead transplanting the notified panchayat
and municipality areas directly into the statutory scheme of
the Rent Act.
26. Having once borrowed and incorporated the
aforesaid terms as part of Schedule I to the Rent Act, the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..40..
phraseology of 'panchayat' and 'municipality' became a static
and geostationary component of the Rent Act. This means that
the geographical limits, boundaries, areas, and territories of
the concerned panchayats and municipalities, as existing on
the date of enactment of Schedule I to the Rent Act, i.e.,
14.05.1965, were immortalized and codified as the 'areas' to
which the Act was intended to apply under Section 1(2) of the
Rent Act.
26.1 Once these terminologies of panchayat and
municipality were borrowed, transplanted, and incorporated
into Schedule I, and thereafter notified under Section 1(2),
they ceased to have any connection, lien, or relationship with
the respective enactments from which they were borrowed,
namely, the Panchayat Act or the Municipality Act.
27. The aforesaid practice is not new to the Rent Act and
is commonly referred to as legislation by incorporation,
whereby a provision or terminology of a primary enactment is
incorporated into a secondary enactment. Once such
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..41..
incorporation takes place, any amendment, modification, or
repeal of the original enactment from which the provisions
have been borrowed does not affect the secondary enactment
into which such terminologies have been transplanted.
27.1 The Constitution Bench of the Supreme Court
discussed this principle in Ram Sarup vs. Munshi6, holding that
even the repeal of an enactment from which provisions have
been borrowed and incorporated into another (secondary)
enactment will not affect the latter. Referring to the judgment
of the UK Courts in Clarke vs. Bradlugh - (1881) 8 QBD 63, the
Supreme Court in Ram Sarup (supra) fruitfully stated, vide
Para 12, as follows:
"12. Where the provisions of an Act are incorporated by
reference in a later Act the repeal of the earlier Act has, in
general, no ef ect upon the construction or ef ect of the Act in
which its provisions have been incorporated. The ef ect of
incorporation is stated by Brett, L.). in Clarke v. Bradlugh.
"Where a statute is incorporated, by reference, into a second statute
the repeal of the first statute by a third does not af ect the second."
AIR 1963 SC 553
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..42..
In the circumstances, therefore, the repeal of the Punjab
Alienation of Land Act of 1900 has no ef ect on the continued
operation of the Pre-emption Act and the expression
"agricultural land" in the later Act has to be read as if the
definition in the Alienation of Land Act had been bodily
transposed into it. Section 2 of the Punjab Alienation of Land
Act. 1900, as amended by Act 1 of 1907 defined 'land' as
follows:
"The expression "land" means land which is not occupied as
the site of any building in a town or village and is occupied or
let for agricultural purposes or for purposes subservient to
agriculture or for pasture, and includes......
It is not in dispute that the land concerned in the claim for
pre-emption made in the appeal satisfies this definition."
(emphasis supplied)
28. The aforesaid view of the Constitution Bench, that
an incorporated provision becomes isolated from the parent
enactment post-incorporation, has been recently reiterated
and followed in Insolvency and Bankruptcy Board of India vs.
Satyanarayan Bankatlal Malu & Ors 7 , wherein the Supreme
Court was confronted with the issue of whether the Special
(2024) 6 SCC 508
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..43..
Court under the Insolvency and Bankruptcy Code (IBC) would
be governed by the procedure provided under Section 435 of
the Companies Act as it existed at the time the IBC came into
effect, or whether it would follow Section 435 as amended in
2018.
28.1 The Supreme Court distinguished between the
effects of "legislation by incorporation" and "legislation by
reference", holding that where provisions of one enactment are
bodily lifted and made part of another enactment, so that the
repeal of the former leaves the latter wholly unaffected, any
subsequent amendments to the original enactment shall not
affect the latter legislation. Any changes, whether substantial
or minor, to the original enactment do not impact the
subsequent enactment. This principle is a settled rule of
statutory construction, uniformly followed whenever the
legislature adopts such a mode of incorporation. The Court
observed this principle at Paras 30 to 32, 34, and 35 of
Satyanarayan (supra), as follows:
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..44..
"30. A Constitution Bench of this Court in Collector of
Customs v. Nathella a Sampathu Chetty has considered the
distinction between "legislation by reference" and
"legislation by incorporation". It will be apposite to refer to
the following observations of this Court in the said case: (SCC
OnLine SC paras 38-39)
"38.... To consider that the decision of the Privy Council
has any relevance to the construction of the legal effect
of the terms of Section 23-A of the Foreign Exchange
Regulation Act is to ignore the distinction between a
mere reference to or a citation of one statute in another
and an incorporation which in effect means the bodily
lifting of the provisions of one enactment and making it
part of another so much so that the repeal of the former
leaves the latter wholly untouched. In the case, however,
of a reference or a citation of one enactment by another
without incorporation, the effect of a repeal of the one
"referred to" is that set out in Section 8(1) of the General
Clauses Act:
8. Construction of references to repealed
enactments
(1) Where this Act, or any Central Act or Regulation made
after the commencement of this Act, repeals and
reenacts, with or without modification, any provision of
a former enactment, then references in any other
enactment or in any instrument to the provision so
repealed shall, unless a different intention appears, be
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..45..
construed as references to the provision so re-enacted."
39. On the other hand, the effect of incorporation is as
stated by Brett, L.J. in Clarke v. Bradlaugh: (QBD p. 69)
'... where a statute is incorporated, by reference into a
second statute the repeal of the first statute by a third
does not affect the second.' This is analogous to, though
not identical with the principle embodied in Section 6-A
of the General Clauses Act enacted to define the effect of
repeals effected by repealing and amending Acts which
runs in these terms: 6-A. Repeal of Act making textual
amendment in Act or Regulation. Where any Central Act
or Regulation made after the commencement of this Act
repeals any enactment by which the text of any Central
Act or Regulation was amended by the express addition,
insertion or substitution of any matter, then, unless a
different intention appears, the repeal shall not affect
the continuance of any such amendment made by the
enactment so repealed and in operation at the time of
such repeal.
"Where a statute is incorporated by reference into a
second statute, the repeal of the first statute by a third
statute does not repeal the second." In the circumstances,
therefore, the repeal of the Assam Municipal Act, 1956
by section 2 of "the Corporation Act" did not affect the
Rent Control Act of 1972. The repeal of the Municipal Act
has had no effect on the continued operation of the Rent
Control Act within the city of Gauhati. As such, the Rent
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..46..
Control Act continued to be in operation in the areas
declared to be or included in the Municipality of Gauhati
or in the notified areas although later they comprised
within the city of Gauhati. In the result, we hold that the
Rent Control Act never ceased to apply in the areas
aforesaid falling within the city of Gauhati even after
15.02.1974. We say "not identical" because in the class of
cases contemplated by Section 6-A of the General Clauses
Act, the function of the incorporating legislation is
almost wholly to effect the incorporation and when that
is accomplished, they die as if it were a natural death
which is formally effected by their repeal. In cases,
however, dealt with by Brett, L.J. the legislation from
which provisions are absorbed continue to retain their
efficacy and usefulness and their independent operation
even after the incorporation is effected."
31. It could thus be seen that the effect of incorporation
means the bodily lifting of the provisions of one enactment
and making it part of another so much so that the repeal of
the former leaves the latter wholly untouched. However, in
the case of a reference or a citation of the provisions of one
enactment into another without incorporation, the
amendment or repeal of the provisions of the said Act
referred to in a subsequent Act will also bear the effect of the
amendment or repeal of the said provisions.
32. In Bolani Ores, this Court was considering the question as
to what would be the ef ect of amendment of the definition of
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..47..
"motor vehicles" for the purposes of the Bihar and Orissa
Motor Vehicles Taxation Act, 1930 (for short "the Orissa
Taxation Act"). The Orissa Taxation Act had adopted the
definition of "motor vehicles as provided in the Motor
Vehicles Act, 1939 for the purposes of taxation. The definition
at the time of adoption brought the motor vehicle under the
ambit of the said definition. It excluded the "motor vehicles"
used solely upon the premises of the owner. However, the said
enactment suf ered an amendment in the year 1956 and
specifically excluded vehicles of special type adapted for use
only in a factory or in any other enclosed premises. It was
sought to be urged on behalf of the State of Orissa that the
definition of "motor vehicles" as adopted in Section 2(c) of
the Orissa Taxation Act was not the definition by
"incorporation" but a definition by "reference" and therefore
amendment to the said definition would also be applicable for
the purposes of taxation under the Orissa Taxation Act.
***
34.It is thus clear that this Court found that, if the vehicles do
not use the roads, notwithstanding that they are registered
under the Motor Vehicles Act, they cannot be taxed under the
Orissa Taxation Act. This Court held in Bolant Ores that the
intention of the legislature could not have been anything but
to incorporate only the definition in the Motor Vehicles Act,
as it existed in 1943, as if that definition was bodily written
into Section 2(c) of the Orissa Taxation Act. It further held
that, if the subsequent Orissa Motor Vehicles Taxation
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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(Amendment) Act, 1943, incorporating the definition of
"motor vehicle" referred to the definition of "motor vehicle"
under the Motor Vehicles Act, as it existed at the time of
enactment of the subsequent Act; the ef ect of this legislative
method would amount to an incorporation by reference to
the provisions of Section 2(18) of the Motor Vehicles Act in
Section 2(c) of the Orissa Taxation Act. It was further held
that any subsequent amendment in the Motor Vehicles Act or
a total repeal of the Motor Vehicles Act under a fresh
legislation on that topic would also not af ect the definition of
"motor vehicle" in Section 2(c) of the Orissa Taxation Act.
35. This Court unequivocally held in Bolani Ores that the
intention of Parliament for modifying the Motor Vehicles Act
had no relevance in determining the intention of the Orissa
Legislature in enacting the Orissa Taxation Act. This Court
held that the dumpers and rockers, which were used by the
miners in their premises though registrable under the Motor
Vehicles Act were not taxable under the Orissa Taxation Act
as long as they were working solely within the premises of the
respective owners."
(emphasis supplied)
29. From the above discussion, it transpires that the
notified territories of panchayats and municipalities have
been bodily lifted to be determined as an "area" under Section
1(2) of the Rent Act. Once such specific determination is made,
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..49..
the area remains completely unaffected by any variations,
expansions, or modifications in the said panchayats or
municipalities under their respective enactments.
30. Therefore, it is beyond any pale of doubt that the
mere borrowing of the notified territories of the erstwhile
panchayats or municipalities from their respective
enactments does not and cannot continue to impact or affect
Schedule I of the Rent Act indefinitely. For this additional
reason, we hold that any change in the nomenclature, status,
geography, or territory of a panchayat or municipality under
their parent enactments, the Panchayat Act or the
Municipality Act, shall have no effect whatsoever on Schedule
I. Whenever the question arises before any RCC or Appellate
Authority regarding the applicability of the Rent Act to any
panchayat or municipality, the guiding principle must be
Schedule I as notified under Section 1(2) of the Rent Act, and
nothing else. We affirmatively hold so.
iii.) Rent Act being a special legislation to remain unaffected by
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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the Panchayat/ municipality enactments
31. Besides, as stated supra, the Rent Act had received
Presidential assent under Article 254 of the Constitution of
India and, therefore, prevails even over the Parliamentary
legislation, namely, the TP Act, within the State. This is
because the Rent Act is a special enactment governing the
subject matter of landlord-tenant relationships, rent fixation,
adjudication of landlord-tenant disputes, and matters relating
to determination of tenancy and eviction of tenants from
rented premises.
31.1 The Panchayat and Municipality legislations may
pertain to the constitution, incorporation, and self-
governance of panchayats and municipalities in the State of
Kerala under the 73rd and 74th Amendments to the
Constitution. However, when it comes to landlord-tenant
relations, it is the Rent Act that becomes the special legislation
on the subject, thereby prevailing over and superseding the
provisions of the Panchayat and Municipality legislations.
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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31.2 This Court derives support for the above
observation from the judgment of the Supreme Court in Atma
Ram Properties Pvt. Ltd. v. Oriental Insurance Co. Ltd8, wherein
the question arose as to which enactment would prevail in the
case of a dispute pertaining to arrears of rent: the New Delhi
Municipal Council Act, 1994 (NDMC Act) or the Delhi Rent
Control Act, 1958 (Delhi Rent Act).
31.3 After a detailed examination of the provisions of
both enactments, particularly the Delhi Rent Act, the Supreme
Court addressed the core issue of whether non-payment of
property tax recoverable under the NDMC Act by a tenant can
constitute grounds for eviction. The Court held that the Delhi
Rent Act is both beneficial and restrictive in nature, providing
a self-contained mechanism for rent control and eviction
disputes. Consequently, the Delhi Rent Act, being a special
enactment, prevails over the NDMC Act, notwithstanding the
(2018) 2 SCC 27
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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NDMC Act being a subsequent enactment. The Supreme
Court's findings, particularly Paras 23 to 28, elucidate why the
Rent Act shall prevail over the NDMC Act and can be
appropriately reproduced as follows:
"23. As seen from the abovementioned judgments, this Court
has held that an earlier enactment will prevail over a latter
enactment even if, there is a non obstante clause in the latter
enactment, if it were to be held that the earlier enactment is
a special enactment on the particular subject being in issue.
24. Assuming that the latter enactment prevailing over the
earlier enactment were to apply to this case, the two
enactments have to be harmoniously construed so as to
ensure that the latter enactment does not cause violence to
the intent of the earlier enactment.
25. In St. Stephen's College v. unity of Delhi, it has been held
thus: (SCC p. 642, para 140)
"140. The golden rule of interpretation is that words
should be read in the ordinary, natural and grammatical
meaning and the principle of harmonious construction
merely applies the rule that where there is a general
provision of law dealing with a subject, and a special
provision dealing with the same subject, the special
prevails over the general. If it is not constructed in that
way the result would be that the special provision would
be wholly defeated."
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..53..
26. Similarly, in Gobind Sugar Mills Ltd. v. State of Bihar this
Court has held as under: (SCC p. 82, para 10)
"10. While determining the question whether a statute is
a general or a special one, focus must be on the principal
subject-matter coupled with a particular perspective
with reference to the intendment of the Act. Keeping in
mind this basic principle, we will have to examine the
provisions of the two Acts to find out whether it is
possible to construe harmoniously the provisions of
Section 4 of the Finance Act and Section 49 of the
Sugarcane Act..."
27. In CTO v. Binani Cements Ltd., it was held that when a general
law and a special law dealing with the same aspect dealt with by the
general law are in question, the general law to the extent dealt with
by the special law is impliedly repealed.
28. The object of the Rent Act is to provide protection to tenants who
under common law, including the Transfer of Property Act could be
evicted from the premises let out to them at any time by the landlord
on the termination of their tenancy. It restricts the right of the
landlord to evict the tenant at their will. It is a special law in relation
to landlord and tenant issues. Therefore, the Rent Act has to prevail
insofar as the landlord and tenant issue is concerned."
(emphasis supplied)
32. The aforesaid judgment applies in all respects to the
controversy and issue at hand. As referred to above, the
delineation and notification of boundaries of panchayats and
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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municipalities under the respective provisions of the
Panchayat Act and the Municipality Act take place for the
purposes of those enactments. The territory of a panchayat,
whether a single village or a cluster of villages at the village
level, a cluster of panchayats at the intermediate level, or at
the district level, is notified and constituted by the State
Government from time to time for the purposes of effective
and efficient self-governance by the panchayats as institutions.
32.1 Likewise, the constitution of a Municipality,
whether as a town Panchayat, a Municipal Council, or a
Municipal Corporation, is also delineated, determined, and
notified by the State Government to endow the concerned
Municipality with the powers of efficient and effective self-
governance at the urban level. Panchayats represent a model
of self-governance at the rural or village level, whereas
municipalities embody the goals and functions of self-
governance at the urban or town level.
32.2 Therefore, the notification, alteration, or
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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modification of territories of Panchayats or Municipalities
undertaken by the State Government is done for the purposes
and objectives for which the Panchayat and Municipality Acts
were enacted. Such actions, however, may not necessarily
conform or be consistent with the aims and objectives of the
Rent Act, which is designed specifically to govern landlord-
tenant relationships with respect to properties falling within
the 'areas' specified in the Schedule.
32.3 For this reason as well, we are inclined to hold that,
insofar as the specification of boundaries or territories of the
'areas' notified under Section 1(2) is concerned, it is only the
Rent Act, a special enactment, that prevails over and above the
provisions of the Panchayat and Municipality Acts of the State.
33. A Single Bench of this Court in Krishna Iyer v. Rama
Krishna Iyer 9 , had also aptly taken the same view that we
adopt today. Holistically considering Sections 1(2) and 1(3) of
1964 KLT 418
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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the Rent Act, the Single Bench held that merely because a part
of the territory of Chowghat Panchayat was notified to be
included as part of Guruvayoor Township under the
Guruvayur Township Act, 1961, its status under the Rent Act
would not be affected.
33.1 In that case, the tenant opposing the application of
the Rent Act to Chowghat Panchayat, in the altered
circumstances of inclusion of the panchayat territories within
the township area, contended that the Rent Act ceased to
apply to the disputed property. Negating the tenant's
argument, the Single Bench held that once a certain area is
included in the Schedule to the Rent Act, its subsequent
inclusion in a municipality or any other township cannot ipso
facto result in cessation of the Rent Act's operation.
33.2 If the Government intended not to apply the Rent
Act to the modified territories, so constituted as a township
under the Guruvayur Township Act, it was always open to the
State Government to issue a modificatory notification under
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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Section 1(3) of the Rent Act. The Single Bench thus held that
the notification issued under the Rent Act is intended to
include the 'area' constituting the territory of the concerned
panchayat within its area of enforcement. The said notified
area, notwithstanding its subsequent exclusion from the
jurisdiction of that panchayat under the panchayat enactment,
does not affect the operability of the Rent Act as previously
notified to be applicable.
34. Two judgments from different High Courts have
helped us navigate the complex legal proposition under
consideration before this Bench. The first is the Division Bench
judgment of the Gauhati High Court in Shri Kamala Dutta &
Ors. v. Ranendra Nath Das 10 , wherein the question arose
regarding the applicability of the Assam Urban Areas Rent Act,
1972, following the conversion of the Municipality of Gauhati
into the Gauhati Municipal Corporation under the separate
(1983) 2 Gou LR 490
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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Gauhati Municipal Corporation Act, 1969.
34.1 Negating the arguments of the tenants regarding
the inapplicability of the Rent Act post-conversion, the
Division Bench held that the definition of "urban area" under
Section 2(g), including the territories of the Gauhati
Municipality, remained unaffected by its upgradation to a
Municipal Corporation. The Court emphasized that the
notification issued under the Rent Act was intended to define
the areas of applicability of the Act, and merely because
certain definitions had been borrowed from the Assam
Municipal Act, 1956 (which later ceased to apply), the
applicability of the Rent Act remained unaffected.
34.2 The Gauhati High Court specifically held that the
Rent Act was neither expressly nor impliedly repealed by the
Gauhati Municipal Corporation Act, and therefore continued
to operate undisturbed within the limits of the newly
constituted Gauhati Municipal Corporation. Paras 5 to 8 and 10
of the judgment are particularly relevant for the discussion at
I.C.R. (O.P. (RC)) No. 12 of 2025 and
..59..
hand and are reproduced herein.
"5. Has the Corporation Act expressly repealed the Rent
Control Act? It must be answered in the negative as the
Corporation Act does not express so. It has been contended
that the Rent Control Act was impliedly repealed. The theory
underlying "implied repeal" is that there is no necessity for
the latter enactment to state in express terms that an earlier
enactment has been repealed, by expressing any particular
set of words, but the legislative intent to abrogate or
supersede the earlier law must be manifested in the latter
enactment that it has effected such supersession. Implied
repeal is not to be readily presumed. If the objects of the two
statutes are different and the language of each statute is
restricted to its own objects or subjects then they are
generally intended to run parallel to each other and there
would be no real conflict, though apparently it may appear to
be so on the surface. The principle upon which the rule of
implied repeal rests is that if the subject matter or object of
the latter legislation is identical with that of the earlier, so
that both cannot stand together, then the earlier Act can be
said to have been repealed by the latter enactment. These
findings have been drawn from Zaverbhal Amaldas vs. State of
Bombay, AIR 1954 SC 752; Municipal Corporation of Delhi vs. Shiv
Shankar, AIR 1972 SC 815; Hari Shankar Bagla vs. State of M. P.
AIR 1954 SC 465. We have considered the objects and subjects
dealt in "the Rent Control Act" as well as "the Municipal Act"
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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and do not find that the objects and subjects dealt with by the
Acts are either the same or similar. We have noticed. that
there is no repugnancy or conflict between the two. However
in one point both the Acts deal with the same subject. It is
Section 444 of "the Corporation Act", which deals with the
applicability or the operation of the Rent Control Act within
the city of Gauhati. The legislative intent evinced in Sec. 444
of the Corporation Act clearly shows that notwithstanding
anything contained in the Rent Control Act the provisions
thereof shall not apply to the land, building or premises
belonging to or vesting in the Corporation. But for the
provisions of Section 444 of the Corporation Act the premises
of the Corporation, which would also have attracted the
provisions of the Rent Control Act, are exempted from
operation. When the Corporation Act itself clearly states that
the provisions of the Rent Control Act shall not be applicable
to the premises belonging to the Corporation it speaks in so
many words that the Rent Control Act would continue to be
in force in the city of Gauhati, subject to the limitation that
provisions thereof shall not be applicable to the premises
belonging to the Corporation. It is true that Sec. 444 of the
Corporation Act refers to the Rent Control Act, 1951 and not
of 1972. There existed no Rent Control Act of 1951 and the
only Rent Control Act in force or in existence was the Rent
Control Act of 1972 when the Corporation Act came into force
in January, 1974. In the result, we have no hesitation in
reaching the conclusion that the Rent Control Act was neither
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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expressly nor impliedly repealed by the Corporation Act. On
the other hand we find the legislative intent not to disturb or
touch the operation of the Rent Control Act within the city of
Gauhati, except putting an embargo that the provisions of the
Act would not be applicable to the premises belonging to the
Corporation. In our opinion, the Rent Control Act was never
repealed by the Corporation Act and the legislative intent to
allow the Rent Control Act to continue its operation within
the city of Gauhati has been clearly expressed in the Act itself.
6. The next contention is that in accordance with the accep-
ted legislative practice to incorporate by reference, Section
2(g) of "the Rent Control Act" incorporated by reference the
provisions of Seca. 5 and 334 of the Municipal Act for the
purpose and for furtherance of the scheme and object of the
Rent Control Act. As such, when the Municipal Act ceased to
apply in the city of Gaubati or repealed by the Corporation
Act, the Rent Control Act was automatically repealed to the
extent it incorporated by reference the provisions of the
Municipal Act As such, it has been contended that there was
an automatic repeal of the Rent Control Act on and from
15.2.74, within the city of Gauhati.
7. It is the legislative practice to incorporate by reference s
provision of an Act into a second Act. If we accept the
contention that there has been incorporation of section 5 and
334 of the Municipal Act in section 2 (g) of the Rent Control
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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Act, the repeal of the Municipal Act by the Corporation Act,
in our opinion, did not af ect "the Rent Control Act" in any
manner whatsoever. Where a provision of an Act is
incorporated by reference into a second Act, it has been ruled
by the Supreme Court in Fam Sarup vs. Munshi, Al 1963 SC 353,
that the repeal of the Brit Act does not af ect the second Act.
Their Lordships relied on the Rule laid down by Brett L. J. in
Clarke 3. Bradlugh (1881) 8 QBD 63, which we extract below:
"Where a statute is Incorporated by reference into a
second statute, the repeal of the first statute by a third
statute does not repeal the second."
In the circumstances, therefore, the repeal of the Assam Muni-cipal
Act, 1956 by section 2 of "the Corporation Act" did not af ect the Rent
Control Act of 1972. The repeal of the Municipal Act has had no ef
ect on the continued operation of the Rent Control Act within the
city of Gauhati. As such, the Rent Control Act continued to be in
operation in the areas declared to be or included in the Municipality
of Gauhati or in the notified areas although later they comprised
within the city of Gauhati. In the result, we hold that the Rent
Control Act never ceased to apply in the areas aforesaid falling
within the city of Gauhati even after 15.2.1974.
8. Let us try to answer the question from another angle and
turn to the Rent Control Act of 1972. It is a piece of permanent
social legislation. In our opinion, the provisions of a
permanent. Act should be construed with the assumption
that use of the provisions is inexact or loose, and those who
assert that a provision is inexact or loose, the burden to
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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establish the proposition lies heavily on them. It can be
discharged only by pointing to something in the context to
show that loose and inexact meaning should be preferred. To
understand the meaning of the definition 'urban area' we
must give it an interpretation consistent with the smooth
working of the system which the benevolent Act purports to
be regulating and that alternative must be rejected which
may introduce uncertainty, confusion or friction into the
working of the system. It is not consistent with the well-
known principles of construction that one is to interpret a
provision with the assumption that the legislature were
dealing with an uncertain state of law or fact and that the
provisions of the Act be construed in the light of that
uncertainty. There is nothing in the context to show that the
expression "urban area" was used in loose or inexact, ever-
changing or uncertain manner. In our opinion, the definition
was meant to be a permanent and fixed definition. If we look
at change its nature and character. The fact that the
Municipal Act ceased to apply in the city of Gauhati could
merely deter new areas to be included within 'urban area'
other than by way of declaration by the State Government
under Section 1(2) (b) of the Rent Control Act. In our opinion,
the Rent Control Act being a firm and permanent Act must
receive the construc-tion we have given. We hold, therefore,
that the areas declared to be or included in the Gauhati
Municipality or the notified areas declared under the
Municipal Act within the city of Gauhati continued to remain
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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an 'urban area' under the Rent Control Act even after the
establishment of the Gauhati Municipal Corporation. The
conclusion finds ample support from the language of section
444 of the Corporation Act.
***
"10. Now let us consider the ef ect of repeal and savings as
contained in Section 2 of "the Corporation Act". The provisions
of repeal and savings are in respect of "the Municipal Act" and have
no bearing on the Rent Control Act. As alluded, the definition
of the expressions "urban area" in the Rent Control Act, used
Sections 5 and 334 of "the Municipal Act" by reference. It
adopted the well known device in legislative practice
generally adopted for the sake of brevity. In Narottam Das va.
State of M. P., AIR 1964 SC 1667 the Supreme Court has ruled
that the definitions remain ef ective even after the other Act,
with reference to which the definition has been adopted,
ceased to exit. Their Lordships have held that the definition
would remain ef ective even after the other Act with
reference to which the definition was given ceases to exist.
This fact of defining expressions in an Act with reference to
some other Act cannot, therefore, have the ef ect of making
the second Act dependent on the first Act. In Ramsarup (supra)
the same view was expressed by their Lordships. In Balani Ors
vs. The State of Orisza. (1974) 2 SCC 777 their Lordships
quoted with approval what Lord Esher, MR said, In re woods
Estate (1886) 31 Ch. D. 607 dealing with legislation by
incorporation, which we extract hereinbelow:
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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"If a subsequent Act brings into itself by reference some
of the clauses of a former Act, the legal ef ect of that, as
has often been held, is to write those sections into the
new Act just as if they had been actually written in it
with the pen, or printed in it, and, the moment you have
these clauses in the later Act, you have no occasion to
refer to the former Act at all".
Their Lordships also approved the view expressed by Brett L.
J. in Clarks vs. Bradlaugh (supra).
As such we are of the opinion that the definition contained in
Section 2(g) of the Rent Control Act remains effective even
after the Municipal Act, with reference to which the
definition was given, ceased to be applicable within the city
of Gauhati. We further hold that the fact of defining
expressions in the Rent Control Act with reference to "the
Municipal Act" did not have the ef ect of making the Rent
Control Act dependent on the Municipal Act. Therefore,
notwithstanding repeal of the Municipal Act by the
Corporation Act, the Rent Control Act, which was never
dependent on the Municipal Act continued to be in force
within the city of Gauhati."
(emphasis supplied)
35. The second judgment on the point is Gopeswar
Mullick and Ors. v. Biraj Mohini Dassi11, a pre-independence
ILR 27 Calcutta 202
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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decision delivered by the Division Bench of the Calcutta High
Court in 1899. The issue before the Calcutta High Court was
broadly analogous to the question under consideration before
this Bench.
35.1 The appellant landlord contended that the
provisions of the Bengal Tenancy Act applied to the scheduled
property, namely the land falling outside the town of Calcutta,
which had been notified as the exempted area under the
Bengal Tenancy Act at the time of its enactment. Conversely,
the respondent tenant argued that since the boundaries of the
town of Calcutta had been expanded and extended under the
Municipal Act of 1888, the newly extended areas should also
be deemed part of the "town of Calcutta," and thus exempted
from the applicability of the Bengal Tenancy Act.
35.2 The Division Bench rejected the tenant's contention
and agreed with the landlord, holding that while the
Municipal Act extended the municipal limits of Calcutta to
consolidate and amend the law relating to municipal affairs of
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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the town and its suburbs, it did not automatically alter or
extend the definition of "town of Calcutta" as notified under
the Bengal Tenancy Act. Consequently, the land in dispute was
not exempted from the operation of the Bengal Tenancy Act,
and the landlord-tenant relationship remained governed by
its provisions. Paras 2 to 4 of the Calcutta High Court judgment
provide a ready reference and are reproduced as follows:
"2. The defence set up in the written statement was a varied
one; that the relation of landlord and tenant did not exist
between the plaintif s and the defendant; that the land was
held in mokurrari and mourasi right; that the defendant had
acquired a title by adverse possession; that the plaintif s were
barred by the statute of limitation, and that, if the defendant
were a tenant under the plaintif s, she was an occupancy
raiyat. Of all these varied contentions, the last only has been
argued before us. The first Court held that the defendant was
an occupancy raiyat and was not liable to be ejected; the
Lower Appellate Court reversed this decision; hence the
present appeal. It is admitted that, before suit, proper notices
to quit had been duly served on the defendant.
3. The first point argued before us on behalf of the appellant
is that the Bengal Tenancy Act applies to the case, the land
being outside the Town of Calcutta. The respondents contend
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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that, having regard to Bengal Act II of 1888, the land in
question is within the Town of Calcutta, and so exempted
from the operation of the Bengal Tenancy Act. I am unable to
take the latter view. The term "Town of Calcutta" is one well
recognised, and at the time of the passing of the Bengal
Tenancy Act its boundaries were well known and well defined,
and that expression, as used in the Tenancy Act, can, in my
opinion, only relate to the Town as it existed at the time of
the passing of the Act. No doubt, the area of the Town has, for
municipal purposes, been extended by the Act I have
mentioned, and this land is within the extended boundary;
but the area was extended for those purposes only, and not
for all purposes. It could scarcely be contended, for example,
that the effect of the Municipal Act of 1888 was to extend the
jurisdiction of the High Court on its Original Side over the
new area, as being within the "Town of Calcutta." The Act
itself draws a distinction between the "Town of Calcutta,"
"Calcutta," and the "suburbs" of the Town, and it would be a
strong thing to hold that this Act, which was one to extend
the "municipal limits of Calcutta," and to consolidate and
amend the law relating to the municipal affairs of the town
and suburbs of Calcutta, was an extension of the "Town of
Calcutta," so as to exclude the newly enclosed area from the
operation of the Tenancy Act. It may be noticed that the new
boundaries are spoken of as those of "Calcutta," not of the
"Town of Calcutta."
4. The land in dispute then is subject to the operation of the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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Bengal Tenancy Act."
(emphasis supplied)
36. The legislature may, in its wisdom, always resort to
the wide powers available under Section 1(3) of the Rent Act
to modify, amend, extend, or even withdraw the areas already
notified as part of the schedule under Section 1(2). Once the
legislature decides to undertake such an exercise of modifying,
amending, or withdrawing any 'area' as notified under Section
1(2), it must necessarily follow the procedure stipulated in the
proviso, which requires consultation with and seeking the
views of the concerned local authority (panchayat or
municipality) before undertaking the exercise.
37. However, if the State Government chooses to keep
Schedule I intact, without effecting any changes or
modifications, the Court cannot draw any inference in favor of
any aggrieved party claiming an automatic modification or
alteration of the 'areas' as already delineated, determined, and
notified under Schedule I of the Rent Act. We accordingly hold
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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so.
Conclusions and answers to the reference:
38. In view of the discussion undertaken above, we
answer the reference by concluding as follows:
a. Clause (2) and Clause (3) of Section 1 of the Rent Act have
distinct ambit and scope. Clause (2) empowers the State
Government to notify the area vide Schedule I to which the
Rent Act becomes applicable. Clause (3), on the other hand,
functions as a superstructure on the foundation of the area
already notified under Clause (2), and relates to the addition,
modification, or withdrawal of any area already notified under
Clause (2). The proviso appended to Clause (3) is confined to
Clause (3) and cannot have any impact on the operation of
Clause (2).
b. Section 1(2) read with Schedule I cannot be interpreted
in light of the proviso to Clause (3), as the proviso has a limited
territorial operation confined to the enacting/principal
provision of Clause (3).
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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c. Notification of panchayats or municipalities under
Schedule I is by incorporation from the erstwhile applicable
Panchayat or Municipality Acts, by bodily lifting the area so
notified as the concerned panchayat/municipality at the
relevant point of time under the respective enactment. Post
incorporation, the said area became disjointed from the
original enactment and was thereafter immortalized.
Consequently, any subsequent change in boundaries,
territories, status, or delimitation of the concerned
panchayat/municipality does not affect Schedule I, as the Rent
Act is independent of the Panchayat or Municipality Acts.
d. The Rent Act is a special enactment concerning landlord-
tenant relationships and related matters and prevails over the
Panchayat and Municipality Acts. Therefore, any alteration of
status, boundaries, or territories of panchayats/municipalities
notified under Schedule I under the Panchayat or Municipality
Acts does not affect the operation of the Rent Act, unless the
State Government, in its discretion, chooses to adopt the
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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modified territory, status, or boundaries under Clause (3) of
Section 1 the Rent Act.
e. The petitioner's plea has no merit and is accordingly
rejected. The contention regarding the inapplicability of the
Rent Act on the conversion of a panchayat to a municipality,
or due to alteration of boundaries or territories over time
under various laws governing local authorities, fails.
Resultantly, the judgment of the Division Bench in
Koorantakath Kamaludeen (supra) and the judgments relied
upon therein, viz., Biyyathu (supra) and Mahammedkutty
(supra), do not correctly lay down the law and are hereby
overruled. The prima facie view taken by the Division Bench of
this Court in the reference order in O.P. (R.C.) No. 16/2025
dated 25.11.2024, and the judgment in Meenakshy (supra),
correctly interpret the provisions of Section 1 of the Rent Act
and are accordingly affirmed.
f. The reference to this Full Bench is answered accordingly,
and the matter is remitted to the Division Bench for deciding
I.C.R. (O.P. (RC)) No. 12 of 2025 and
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the pending proceedings finally in accordance with the
observations and conclusions recorded above.
This Court places on record its appreciation for the
valuable assistance rendered by the learned Amicus Curiae, Sri
Gopalakrishna Kurup K, Advocate General, State of Kerala, in
the present case.
Sd/-
SUSHRUT ARVIND DHARMADHIKARI,
JUDGE
Sd/-
GOPINATH P.,
JUDGE
Sd/-
G. GIRISH,
JUDGE
jjj
15-01-2026 /True Copy/ Assistant Registrar
