MURLIDHAR AGARWAL & Anr. v. STATE OF U.P & Ors.

-of the Allahabad High Court in First Appeal No. 82 of 1970. c S. V. Gupte, J. P. Goyal and S. : M. Jain, for the appellants (in both the appeals) R. K. Garg, S. C. Aggarwal, S. S. Bhatnagar and V. J. Francis, for the respondent (in C. A. No. 583/71) G. N. Dixit and 0. P. Rana, for the respondent Nos. 1,3 and 4. Civil Appeal No. 2370 of 1969 The Judgment of the Court was delivered by MATHEW J. The appellants filed a petition nuder Article 226 of the ·Constitution before the High Court of Allahabad praying that the order passed by the State Government on October 20, 1967, allowing .a revision filed by the respondent be quashed and possession of the premises in question be given to them under s. 7-A of the U. P. '(Temporary) Control of Rent and Eviction Act, 1947 (hereinafter . called the Act). The original owner of the premises was one Ram Swaroop Gupta. He leased the premises to M/s Pioneer Exihibitoril and Distributors Limited. They used the premises for exhibiting cinema. That lease terminated by efllux of time on June 30, 1952. Gupta, thereafter, ~eased the premises by a deed dated October 13, 1952 for a period of 10 years to Ram Agyan Singh, respondent No. 2. But there was no order allotting .the accommodiftion to him under S. 7(2) of the Act. Respondent No. 2 also used the premises for exhibiting cinemato graph films. Disputes having arisen between the parties, Gupta filed suits for recovery of rent as well as for ejectment against res pondent No. 2. The appellants purchased the premises in question from Ram Swaroop Gupta by a sale deed dated March, 26, 1962. Thereafter they filed an application under s. 7 of the Act read with the Act for release of the accommodation rule 6 made under in their favour. On December 3, 1965, the Additional District Magis trate allowed the application and permitted the appellants to take possession of the premises. That was on the basis that the pre mises were in illegal occupation of respondent No. 2. The repre this order filed by respondent No. 2 to the State ,sentation against D E F G H A B c D E F G H ' • 'MURLIDHARV, u.r. STATE (Mathew,/,) 577 Government was rejected ori January 10, 1966 c-n the grcuLd that there was no provision for any interference by Governmrnt . with the order. On December 4, 1965, the appellants filed an application for eviction of respondent No. 2 under s. 7-A of the Act. On June 18,. isrne of notice 1966, the Additional District Magistrate direct<d under clause (2) of s. 7-A, why respondent No. 2 should not be Thereafter, the Additional District Magistrate pasmf evicted. the order for eviction. Respondent No. 2 went up in revisicn aEainst the order to the Additional Commissioner. He ccnfomcd the 01der of the Additional District Magistrate. Respondent No. 2, thereafter,. filed an application for revision under s. 7-F of the Act before the The State Government State Government allowed that application on October 20, 1967 holding that respondent No. 2 was not liable to be evicted from the premises. On January 20, 1968, the State Government communicated to the parties a summary of the reasons on the basis of whicli the order had been passed. That in effect said that the respondent was running a cinema under a licence in the premises from 1952, that the District Magistrate, when be granted thi: licence, was satisfied that respondent No. 2 was in lawful occupation and that, in these circumstances, he was entitled to the benefit of the proviso to s. 7-A(I) of the Act and was not liable to be evicted from the premises. against the order. It was to quash this order that the appellants filed the writ petitic n 9efore the High Court. A learned Single Judge of the Court quashed the order. Res pondent No. 2 filed an appeal against the order. divisicn. Bench reversed the order of the learned Single Judge. It is against this order that this appeal has been filed on the basis of a certificate granted under Article 133(1 )(b) of the Constitution. The The division Bench was of the view that the learned Single Judge was not justified in interfering with the 01der passed by the State Ocvern ment under s. 7-F of the Act inasmuch as the order of the State Govern ment did not suffer from any info mity either on the grcund that it had no jurisdiction to pass the OJder or for the reason that there was an error of law apparent on the face of the record. The material provision in s. 7-A of the Act prcvides : occupation-(!) Where "S. 7-A. District Magistrates' power to take action against unauthorised pursuance of the order of the District Magistrate under rnb-secticn (2) of Section 7 the vacancy of any acccmmcdation is required to be reported and is not reported, or where an order requiring any accommodation to be let or not to be let has been duly passed under sub-section (2) of Section 7 a_nd the District Magistr~te believes or person reason the accommo has in contravention of the said order, occupied the person. dation or any part in occupation to show cause, within a time to be fixed by him, why he should not be evicted therefr<'m; thereof, he may call upon believe 578 SUPREME COURT REPORTS [1975] l s.c.R. Provided that no order under this section shall be passed if the District Magistrate is sati~fied that there has been undue delay or it is otherwise inexpedient tff do so" to sub-section (I) of s. 7-A is couched in wide lan The proviso guage. The dictionary meaning of the word 'inexpedient' is: "Not expedient; circumstances; disadvantageous in the unadvisable, impolitic." (1) the section. 'The circumstances that could be taken into consideration to decide whether it is expedient or inexpedient to order an eviction under the section are not ml!ntioned in the proviso. A great deal of dis cretion must, therefore, be vested in the District Magistrate and in the State Government when disposing a revision from an orc\er passed by the District Magistrate as several factors would enter the making of the verdict whether it is inexpedient to pass an order of .eviction under In this case, the State Government . has taken into account two reasons for exercising its discretion under the proviso in favour of respondent No. 2: (!)that respondent No. 2 was in possession from 1953 onwards and was conducting a cinema in the premise& after obtaining a licence frcm tlte District Magistrate under the U. P. Cinema Regulation Act; (2) that the District Magistrate when granting the licence to conduct the cinema must have been sa tisfied that the( respondent was in lawful occupation of the premises. in substance the State Government said was, 1n other words, what tnat respondent No. 2 has been ming the premises for conducting <einema ftom 1953 on the basis of his possession of the premises and that it would be inexpedient to evict him at this stage. We cannot <Say that the circumstances taken i.nto account are irrelevant for the -exercise of the discretion. Mr. Gupte, appearing for the appellants, said that when the Addi tional District Magistrate passed the order for release on the basis ·tnat the appellants require the premises bona fide for their per sonal occupation, the State Government, in the exercise of its revisional jurisdiction under s. 7-F against the order of eviction under s. 7-A ;should not have nullified the effect of the order of release by exercising its discretion under the proviso to s. 7-A against the appellants. 'He also said that the State Government did not even refer to the order for release which would show that it made no assessment of the hard- ·ship to the landlords. A B C D E F The fact that an order for release was passed by the Additional District Magistrate on the basis that the premises were bona required by the appellants for their personal occupation did net pre clude him, when he was moved by the appellants to evict respondent -no. 2 from exercising his discretion under the proviso to s. 7-A. For it is at that stage that the respondent will have the opportunity to urge the circumstances which make it In other words, the only relevant question at the time when the order inexpedient to evict him. G H (I) See Shorter Oxford English Dictionary, Illustrated, Vol. 1, 3rd ed., (1964), IP· 997. ' + • A 8 c 0 E F G H MURLIDHAR v. u.P. STATE (Mathew, J.) 579 of release was passed was whether the appellants required Tue controversy was for their occupation. premises bona fide limited at that stage to that question. The circumstances ~hich would make the passing of an order of eviction inexpedient under s. 7-A could not have been urged at that time by respondent No. 2. So, the inference that the State Government was not aware of the order for release on the ground that the appellants required the premises for their personal occupation could not be made frcm the fact that the State Government to order the eviction of the second respondent in the exercise of its discretion under the proviso to s. 7-A when disposing of a revision. found that it was inexpedient We are not satisfied that the order of the State Government was vitiated by any error of law apparent on the face of the record. As already stated, the considerations which weighed with the State Gcvern ment in rejecting the application, namely, the hardship to respon dent No. 2 who was conducting a cinema in the premises frcm 1953 cannot be said to be irrelevant. As the order of the State Government did not suffer from any error of law apparent on the face of tke record, the learned Single Judge was not justified in quashing the order and the Division Bench rightly set aside the order of the learned Single Judge and allowed the appeal. · We dismiss the appeal but, in the circumstances, make no order as to costs. Civil Appeal No. 583 of 1971 In this appeal, by certificate, we are concerned with the question whether the suit filed by the appellants for recovery cf possession of the premises which is the subject matter of Civil Appeal ND. 2370 of 1969, on the basis that the tenancy created by Ram Swarccp Gupta the predecessor-in-interest of the appellants, in favour cf Ram Agva~ Singh, the respondent, had expired and, therefore, the appellants were entitled to recover possession of the same, was maintainable in law in view of the fact that it was instituted without obtaining the per mission of the District Magistrate under s. 3(1) of the U. P. (Tempcrary) Control of Rent and Eviction Act, 1947 (hereinafter called the Act). Tue trial court held that although the respondent was a tenant against whom the suit cannot be filed without the previous permission as visualised bys. 3 of the Act, yet he cannot claim the benefit of s. 3 on account of clause 20 of the lease deed and decreed the suit. On appeal by the respondent, the High Court revmed the decree holding that the suit was not maintainable in view of s. 3, and dis: missed lhe suit. It is from this decree that this appeal has been filed . The two questions which arise in this appeal are: (l) whether the High Court was right in holding thats. 3 was applicable and, therefore the suit was not maintainable; and (2) whether clause 20 of the leas~ deed was a bar to the respondent from claiming that the provisions of s. 3 were applicable. t .J • -· 580 SUPREME COURT ~EPORTS (1975] 1 s.c.R. Section 3{l)insofar as it is material, provides,: "3. Restrictiow on eviction-(!) Subject to any order passed under sub-section (3) no suit shall, without the permission of the District Magistrate, be filed in any Civil Court against a tenant for his eviction from any accommodation except on one or more of the following grounds:-" The lease deed in question was executed after the commencement of the Act and the respondent did not obtain an allotment under s. 7(2) of the Act in his favour from the District Magistrate. It was, there fore, contended on behalf of the appellants that the respondent was not a tenant within the meaning of that term in s. 3 as the lease was created in violation of the provision of s. 7(2). In Udho Dass v. Prem Prakash(!) a Full Bench of the Allahabad High Court took the view that a lease made in violation of the pro visions of s. 7(2) would be valid between the parties and would create the relationship of landlord and tenant between them although it In the light of this ruling might not bind the authorities concerned. the correctness of which we see no reason to doubt-we think that respondent had been paying the the respondent was a tenant. The rent to Ram Swaroop Gupta and to the appellants after the sale by him to the appellants. "Tenant" is defined under s. 2(g) of the Act as follows: "2(g) 'Tenant' means the person by whom rent is, or but for a contract express or implied, would be payable for any accommodation". tenant who accupation of Now, the landlord and the tenant cannot, by their. agreement bind the District Magistrate. In spite of the lease, the District Magi'. strate may treat the accommodation as vacant and ev; ct therefrom accommodation is his statutory obligation. without an allotment order. This But the appellants would be estopped from denying that the respondent is a tenant. The Act makes a distincfon between a tenant by virtue of an allotment order and a tenant otherwise than by virtue of an allotment order. In most of the sections of the Act the word 'tenant' alone is used. If the word 'tenant' in s. 3 is construed as "tenant under an allotment order", then the tenants who have been occupying an accommo~atio~ . without an allotment order will be deprived of several matenal pnvileges conferred upon them by the Act. Having regard to the defimt1on clause and the scheme of the Act we are of opinion that the respondent is a tenant under s. 3 even t!to'ugh is occupying the accommodation without an allotment order. It follows that the respondent would get the protection under s. 3 3.1'\d th<\t the appellants' suit was, therefore, liable to be dismissed as it was found that it was instituted without the permission of the Dist rict Magistrate. (I) (1963) A.L.J. "406. A B c D E F G H ' + ., ' A B c D E F G 11 • MURLWl!AR v. U.P. STATE (Mathew, !.) 5 81 We now turn to the other question, riz., whether under clause 20 of the lease deed, .the respondent was precluded from contending that the suit was not maintainable even though it was instituted without the permission of the District Magistrak Clau;e 20 of the lease deed provides: "That this agreement of lease has been made between th' parties with the knowledge of the existing Rent Control and Eviction Act. The parties ·do hereby agree and declare that no party will ever claim the benefit of the said Acts and that the provisions of the said Acts have been agreed by mutual consent to be inapplicable to this deed." Tho qu~stiou for consideration is whether this clause is ilkgal. Clause 20 contains two provisions. The first provision is that the 'Jhe second provision parties will never claim the benefit of the Act. is that tho provisions of the· Act will be inapplicable to the lease detd. The High Court has taken the view that clause 20 is i!J':llal, and, there• fore, the respondent was not precluded from contending thatilie suit was not maintainable. Th' Act was passed inter alia to prevent the eviction of tena11ts frorn th~ir accommodations. The language of s. 3 (I) is imperative and it prohibits the institution of the 6llit without the permission. If any landlord institutes a suit for eviction of the tenant without the permission of the Distri.ct Magistrate, he ccmmits an offence ar;d is punishable under s. 15 of the Act. The object of s. 3 is to give protec tion to a tenant from eviction from an accommcdation. The policy the District Magistrate should consider the claim of the landlord and the needs of the tenant before granting pennission. Tl1ere was alarm ing scarcity of accommodation. The object of legislature in enacting tue law was to protect tenants from greedy and grasping landlords, and from their resorting to court for evicticn cf tenants withcut re asonable · grounds. th' Act seems to be that a responsible authority Under s. 23 of the Indian Contract AcL 1872, an agreement is void if it defeats any provision of law: '"S. 23. The consideration or object of an agreement is lawful, unless-- it is forbidden :by law; or is of such a nature, that, if permitted, it would cefeat provisions of any law, or is fraudulent; or involves or implies injury to the p'Tson or property of another; or the Court regards it as immoral, or opposed to public policy. In each of these cases, the consideration er object of an agreement is said to be unlawful. Every agreement of which the object or consi deration is unlawful is void." Mr. Gupte, appearing for the appellants, referred to the decisicn of this Court in Lachoo ~Mal ''- Radhey Shyam(I) ~nd said that (l) [1971] 3 S,C.R. 693. 5-MlSS Sup. Cl/75 • + 582 SOPREME COURT REPORTS [1975] 1 s.c.R. it was open to the respondent to waive the benefit of the provision of s. 3 as it was enacted for the benefit of tenants and that no qu·estion of public policy is involved. ftl that case this Court was considering the question whether it was open to a landlord to waive the benefit of a provision enacted for the benefit of landlords under the Rent Control Act. This Court said tbt if a provision is enacted for the benefit of a person or class of persons, there was nothing whicl1 precludes him or them that no quest10n from contracting to waive the benefit, provided of public policy was involyed. "Jf the object of a statute is not one of general policy, or if the thing is being done will benefit only a particular perso1i or class of persons, then the conditions prescribed by tlie statute are not considered as being indispensable. This rule is expremd by the maxim of law, quilibet potest renuntiare jurl pro se introducto. As a general rule, the conditions imposed by statutes which authorise legal proceedings are treated as being indispensable to giving the co1,1rt jurisdiction. But if it appears that the statuto1y ccnditicns were m- serted by the legislature simply foi the security or benefit of the parties to the action themselves, and that no public interests are involved, such conditions will not be considered as indispensable, and either party may waive them without affecting the jurisdiction of the court. ... "( 1) Maxw~ll states th~ rule of law as follows: "Anothor maxim which sanctions the non-observance of a statutory provision is that cu/ibet licet renuntiare j1rri pro se introducto. Everyone has a right to waive and to agree to waive the advantage of a law or rule made solely for the benefit and protection of the individual in his private capacity, which nuy be dispensed with without infringing any public right or public policy. Where in an Act there is no express prohibition against contracting out of it, it is necessary to consider whether the Act is one which is intended to deal with private rights only or whether it is an Act which is intended, as a matter of public policy, ~o have a. more extensive operation .... "(2). A n c D E F So, the question is, whether s. 3 was enacted only for the benefit of tenants or whether there is a public policy underlying it which precludes a tenant from waiving its benefit. There can be no doubt that the provision has been enacted for protecting one set of men from another set of men, the one from their situation and condition are liable to be oppressed and imposed upon. Necessitous men are not free men. In the Nineteenth-Century the doctrines of /aissex faire capitalism were accepted as part of the natural order of things and the doctrine was re-inforced by the idea of the early utilitarians that to achieve social Justice, it would suffice to produce formal equality before the G H (!) See Craies on Statute Law, 7th ed,. pp. 269-270. (2)S ee "Interpretation of Statutes", 11th ed., (1%2), pp. 375-376. MURLIDHAR v. U.P. STATE (Mathew, /.) 583 Jaw. These views were reflected in contemporary legal thought by the idea that freedom of contract was the supreme article of public policy, a notion which ignored utterly those cases where there was no genuine equality of bargaining power as for example between master and servant or between landlord and tenant.(!) t There can be no doubt about the policy of the law, namely, protection of a weaker class in the community from haras~ment of frivolous suits. But the question is, is there a public policy behind it which precludes a tenant from waiving it? c D F G H j • The expression 'public policy' has an entirely different meaning from 'policy of the law' and one much more extensive(2). Never theless, the term 'public policy' is used by the House of Lords itself apparently as synonymous with the policy of the law or the policy of a statute [see Hollinshead v. Haz/eto11(l).] Yet it is clearly so used without intent to repudiate or disregard the distinction so clearly drawn in Egerton v. Brownlow. It seems clear that the conception of public policy is not only now quite distinct from that of the policy of Jaw but has in fact always been so except in some exceptoinal instances of confusion which have had no substantial effect on the general course of authority(4). The Courts have often repeated Mr. Justice Burrough's metaphor about public policy being an unruly horse. Some judges appear to have thought it more like a tiger and have refused to mount it at all, perhaps because they feared the fate of the young lady of Riga. Others have regarded it like Balaam's ass which would carry its rider nowhere. But none, at any rate at the present day, has look<Ci upon it as a Pegasus that might soar beyond the mcmentary needs of the ccrnrnuni ty. There is nothing remarkable in this because the topic itself is so clusive(5). legislation founded on "Public Policy" has been defined by Winfield as "a principle of judicial the current in.terpretaticn needs of the community"('). Now, this would show that the inter ests of the whole public must be taken into account; but it leads in practice to the paradox that in many cases what seems to he in con templation is the interest of one section only of the public, ard a 'mall section at that. The explanation of the paradcx is that the ccurts must certainly weigh the interests of the whole community as well as the interests of a considerable section of it, such as trnants, fer imtance, as a class as in this case. If the decision is in their favour, it means no more than that there is nothing in their conduct whi'h is prejudicia 1 to the nation as a whole. Nor is the benefit of the whole ccmmunity always a mere tacit consideration. Tre courts may have to strike a (!) See Dennts Lloyd, "Public Policy" (1953), pp. 136-137 . (2) See Eserto11 v. Brownlmv, 4 H.L.C. p. 105. (3) [1916] 1 A.C. 428. (4) see W.S.M. Knight, "Public Policy in English Law'', 38, Law Quarterly Rev., '1.07, at pp. 217-218. 5) see Percy H. Winfield, "Public Policy in English Common Law". Harvard Law Rev. 76. ' + • 584 SUPREME COURT REPORTS · [1975] 1 S.C.jl. balance in express terms between community interests and sectional . interests, So, here we arc concerned with the general freedom of contract which everyone possesses as against the principle that this freedom shall not be used to subject a class, to the harassment of suits without valid or reasonable grounds. Though there is considerable supportinjudicial dicta for the view ·that courts cannot create new heads of public policy, (1) there is also no lack of judicial authority for the view that the categories of heads ofpublicpolicyarenotclosed and that there remains a broad field within which courts can apply a variable notion of policy as a principle of judicial legislation or inter pretation founded on the current needs of the community. (2). A Public policy does not remain static in any given conununity. It may vary from generation to generation and even in the rnme gcr.eia- tion. Public policy would be almost useless if it were to remain in. C fixed moulds for all time. the duty of doing so. If it is variable, if it depends on the welfare of the community at any given time, how are the courts to ascertain it ? The judges are more to be trusted as interpreters of the Jaw than as expounders of public policy. However, there is no alternative under our system but to vest this power with judges. The difficulty of discovering what public policy is at any given moment certainly does not absolve the In conducting an enquiry, as judges from already stated, judges are not hide-bound by precedent. The judges must look beyond the narrow field of past precedents, though still leaves open the question, in which directio11. They must cast their gaze. The judges are to base their decision on the opinions of men of the world, as distinguished from opinions based on legal learning. In other words, the judges will have to look beyond the jurisprudence and that in so doing, they must consult not their own personal stan dards or predilections but those of the dominant opinion at a given moment, or wliat has been termed customary morality. The judge< must consider the social consequences· of the rules propounded, es- peciaUy in the light of the factual evidence available as to its protable it is not to be expected that men of the world results. Of course, in the trial of every action are to be subpoenaed as expert witnesses It is not open to the judges to raising a question of public policy. make a sort of referendum or hear evidence or conduct an inquiry as to the prevailing moral concept. Such an extended extra judicial enquiry is wholly outside the tradition of courts where the tendency is to 'trust the judge to be a typical representative of his day and generation'. Our law .relics, on the implied insight of the judge It is the judges themselves, assisted by the bar, on such matters. who here represent the highest cmrunon factor of ]'Ublic sentiment that judges a11d intelligencc(3). No doubt, there is no assurance (1) See Gherulal Parakh v. Mahadeodas Maiya & Ors. f 1959J Supp. r 2 SCR. ' ' 406, 440. (2) See Dennis Lloyd, "Public Policy" (1953), pp. 112-l!J. (3) see Percy H. Winfield. "Public Policy in English Common Law" 42 Harvard Law Rev. 76 and also, Dennis Lloyd, "Public Policy" (1953), pp. 124-125. 0 E F G H ~IURL!Dl!AR v. U.P. STATE (Mathew,-].) 585 A B will interpret the mores of their day more wisely and truly than other men. But this is beside the point. The point is rather th.at this power must be lodged somewhere and under our Constitution and laws, it has been lodged in the judges and if they have to fulfil their function as judges, it could hardly be lodged elsewhere(!). We think that s. 3 is based on public policy. As we said, it is intended to protect a weaker section of the ccmmunity with a vitw to ultimately protecting the interest of the community in i;cnernl by the section is creating equality of bargaining power. Although primarily intended for the protection of tenants only, that protection is based on public policy. The respondent could not have wai\·ed the benefit of the provision. c The language of the section as already stated, is prohibitive in It precl11des a court from entertaining the suit. We character. think the High Court was right in its conclusion. We dismiss the appeal with costs. P.H. Appeal diimissed . • • (I) Sec Cardozo," The Nature of Judicial Process", pp. l 35-136.