# DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. LTD. AND ITS ESTATE

- **Citation:** [2014] 2 S.C.R. 480
- **Court:** Supreme Court of India
- **Decided:** 2014-02-11
- **Case number:** Civil Appeal No. 1970 of 2014
- **Bench:** H.L. Gokhale, J. Chelameswar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/dr-suhas-h-pophale-v-oriental-insurance-co-ltd-and-its-estate-29853
- **Pages:** 57

## Headnote

PUBLIC PREMISES (EVICTION OF UNAUTHORISED
C OCCUPANTS) ACT, 1971:
ss.15 and 2(e) r/w s.2(d) - "Public premises" - Eviction of
unauthorized occupants - Appellant in occupation of suit
property belonging to predecessor-in-title of first respondent,
D Oriental Insurance Co. Ltd. - Held: In Ashoka Marketing Ltd.,
it has been held that Rent Control Act and Public Premises
Act operated in two different areas -- The provisions of the two
enactments will have to be read harmoniously to permit the
operation and co-existence of both of them to the extent it can
E be done - In the instant case, appellant was protected as a
'deemed tenant' uls 15A of Bombay Rent Act, prior to the
merger of the erstwhile insurance company with first
respondent-Government Company and continued to be
protected as tenant uls 7(15)(a}(ii) of Maharashtra Rent
Control Act -- He could be removed only in accordance with
F the procedure available under Bombay Rent Act or
Maharashtra Rent Act - Leave and licence - Maharashtra
Rent Control Act, 1999 - Bombay Rents, Hotel and Lodging
House Rates Control Act, 1947 - s. 15-A.
G
s.2(e) - "Public premises" - Eviction of unauthorized
occupants - Appellant in occupation of suit property prior to
their being acquired under the Act - Held: - The appellant's
status as a deemed tenant was accepted under the State
enactment and, therefore, he could not be said to be in
H
480
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. 481
LTD. AND ITS ESTATE OFFICER
"unauthorised occupation" -- His right granted by the State
A
enactment cannot be destroyed by giving any retrospective
application to provisions of Public Premises Act, since there
is no such express provision in the statute, nor is it warranted
by any implication -- In fact premises occupied by him would
not come within the ambit of Public Premises Act, until they
B
belonged to first respondent , i. e until 1. 1. 197 4 -- If first
respondent wanted to evict the appellant, remedy was to resort
to the procedure available under Bombay Rent Act or its
successor Maharashtra Rent Act, by approaching the forum
thereunder, and not by resorting to the provisions of Public c
Premises Act.
s.2(e) - "Public premises" - Eviction of unauthorized
occupants - Held: In Ashoka Marketing, it has been obseNed
that Public Premises Act is enacted to deal with mischief of
'rampant unauthorised occupation' of public premises -
Clause 2(1) of guidelines dated 30.5.2002 emphasises that
the Act was meant to evict (a) totally unauthorised occupants
of the public premises or subletees, or (b) employees who
have ceased to be in their seNice, and were ineligible to
occupy the premises -- "Guidelines to Prevent Arbitrary use
of Powers to Evict Genuine Tenants from Public Premises
Under the Control of Public Sector Undertakings I Financial
Institutions (dated 30-5-2002, published in the Gazette of India
dated 8-6-2002).
Application of the Act - Held: For any premises to
become public premises, the relevant date will be 16.9.1958
or the date on which the premises become public premises
as belonging to or taken on lease by Corporation/ Companies
D
E
F
like the first respondent, whichever is later -- All those persons
G
falling within the definition of 'tenant' occupying the premises
prior thereto will not come under the ambit of Public Premises
Act and cannot, therefore, be said to be persons in
''.unauthorised occupation" -- Whatever rights such prior .
tenants, members of their families or heirs of such tenants or
H
482
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A deemed tenants or all of those who fall within the definition of
'tenant' under the Bombay Rent Act have, are continued under
Maharashtra Rent Act -- If possession of premises in their
occupation is required, that will have to be resorted to by taking
steps under the Bombay Rent Act or Maharashtra Rent Act -
B - Maharashtra Rent Control Act, 1999.
A leave and licence agreement in respect of the suit
premises belonging to Indian Mercantile Insurance
Compan

## Text

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A
B
[2014] 2 S.C.R. 480
DR. SUHAS H. POPHALE
v.
ORIENTAL INSURANCE CO. LTD. AND ITS ESTATE
OFFICER
(Civil Appeal No. 1970 of 2014)
FEBRUARY 11, 2014
[H.L. GOKHALE AND J. CHELAMESWAR JJ.)
PUBLIC PREMISES (EVICTION OF UNAUTHORISED
C OCCUPANTS) ACT, 1971:
ss.15 and 2(e) r/w s.2(d) - "Public premises" - Eviction of
unauthorized occupants - Appellant in occupation of suit
property belonging to predecessor-in-title of first respondent,
D Oriental Insurance Co. Ltd. - Held: In Ashoka Marketing Ltd.,
it has been held that Rent Control Act and Public Premises
Act operated in two different areas -- The provisions of the two
enactments will have to be read harmoniously to permit the
operation and co-existence of both of them to the extent it can
E be done - In the instant case, appellant was protected as a
'deemed tenant' uls 15A of Bombay Rent Act, prior to the
merger of the erstwhile insurance company with first
respondent-Government Company and continued to be
protected as tenant uls 7(15)(a}(ii) of Maharashtra Rent
Control Act -- He could be removed only in accordance with
F the procedure available under Bombay Rent Act or
Maharashtra Rent Act - Leave and licence - Maharashtra
Rent Control Act, 1999 - Bombay Rents, Hotel and Lodging
House Rates Control Act, 1947 - s. 15-A.
G
s.2(e) - "Public premises" - Eviction of unauthorized
occupants - Appellant in occupation of suit property prior to
their being acquired under the Act - Held: - The appellant's
status as a deemed tenant was accepted under the State
enactment and, therefore, he could not be said to be in
H
480
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. 481
LTD. AND ITS ESTATE OFFICER
"unauthorised occupation" -- His right granted by the State
A
enactment cannot be destroyed by giving any retrospective
application to provisions of Public Premises Act, since there
is no such express provision in the statute, nor is it warranted
by any implication -- In fact premises occupied by him would
not come within the ambit of Public Premises Act, until they
B
belonged to first respondent , i. e until 1. 1. 197 4 -- If first
respondent wanted to evict the appellant, remedy was to resort
to the procedure available under Bombay Rent Act or its
successor Maharashtra Rent Act, by approaching the forum
thereunder, and not by resorting to the provisions of Public c
Premises Act.
s.2(e) - "Public premises" - Eviction of unauthorized
occupants - Held: In Ashoka Marketing, it has been obseNed
that Public Premises Act is enacted to deal with mischief of
'rampant unauthorised occupation' of public premises -
Clause 2(1) of guidelines dated 30.5.2002 emphasises that
the Act was meant to evict (a) totally unauthorised occupants
of the public premises or subletees, or (b) employees who
have ceased to be in their seNice, and were ineligible to
occupy the premises -- "Guidelines to Prevent Arbitrary use
of Powers to Evict Genuine Tenants from Public Premises
Under the Control of Public Sector Undertakings I Financial
Institutions (dated 30-5-2002, published in the Gazette of India
dated 8-6-2002).
Application of the Act - Held: For any premises to
become public premises, the relevant date will be 16.9.1958
or the date on which the premises become public premises
as belonging to or taken on lease by Corporation/ Companies
D
E
F
like the first respondent, whichever is later -- All those persons
G
falling within the definition of 'tenant' occupying the premises
prior thereto will not come under the ambit of Public Premises
Act and cannot, therefore, be said to be persons in
''.unauthorised occupation" -- Whatever rights such prior .
tenants, members of their families or heirs of such tenants or
H
482
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A deemed tenants or all of those who fall within the definition of
'tenant' under the Bombay Rent Act have, are continued under
Maharashtra Rent Act -- If possession of premises in their
occupation is required, that will have to be resorted to by taking
steps under the Bombay Rent Act or Maharashtra Rent Act -
B - Maharashtra Rent Control Act, 1999.
A leave and licence agreement in respect of the suit
premises belonging to Indian Mercantile Insurance
Company Ltd., the predecessor-in-title of the first
respondent-Oriental Insurance Co. Ltd., was executed by
C the original tenant on 20.12.1972 in favour of the appellant
. It was the case of the appellant that Indian Mercantile
Insurance Company started accepting rent directly from
him. The Company merged on 1~1.1974 into the first
respondent-Oriental Insurance Co. Ltd., a Government
Q Company, which addressed a notice dated 12.7.1980 to
the original tenant terminating his tenancy with respect
to the suit premises, and then filed a suit for eviction
against him and the appellant in the Small Causes Court,
under the provisions of the Bombay Rents, Hotel and
E Lodging Houses Rates Control Act, 1947 ('Bombay Rent
Act'). The appellant sent a letter dated 22.11.1984 to the
first respondent requesting them to regularize his
tenancy as a statutory tenant. The first respondent,
however, preferred Case No.10 and 10A of 1992 before
F the second respondent - Estate Officer, under the Public
Premises (Eviction of Unauthorised Occupants) Act, 1971
('Public Premises Act') to evict the original tenant and the
appellant, and also to recover the damages. The first
respondent withdrew on 22.2.1994 the suit filed in the
G Small Causes Court. The second respondent passed an
order on 28.5.1993 directing eviction of the original tenant
and the appellant, and also for recovery of damages. The
appellant filed an appeal u/s 9 of the Public Premises Act
before the City Civil Court, which set aside the order of
H damages, and remanded the matter to the second
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. 483
LTD. AND ITS ESTATE OFFICER
respondent to reconsider that aspect, but upheld the
A
order of eviction. The appellant filed a writ petition before
the High Court mainly contending that his occupation of
the suit premises was protected under the newly added
s. 15A of the Bombay Rent Act with effect from 1.2.1973,
i.e. prior to the first respondent acquiring the title over the
B
property from 1.1.1974 and, as such, he could not be
evicted by invoking the provisions of Public Premises
Act, by treating him as an unauthorised occupant. The
High Court relying upon the judgment in Ashoka
Marketing Ltd. held that the provisions of the Bombay c
Rent Act were not applicable to the suit premises, and the
said premises were covered under the Public Premises
Act, and dismissed the writ petition.
The question for consideration in the instant appeal
was: whether the rights of an occupant/licensee/tenant D
protected under a State Rent Control Act (Bombay Rent
Act, 1947 and its successor Maharashtra Rent Control
Act, 1999, in the instant case) could be adversely affected
by application of the Public Premises Act, 1971.
Allowing the appeal, the Court
HELD: 1.1 The relationship between the erstwhile
insurance company as the landlord and the appellant as
E
the occupant, at all material times was governed under
F
the Bombay Rent Act. The legislature thought it
necessary to protect the licensees also in certain
situations. Therefore, the Act was amended, and s. 15A
was inserted therein to protect the licensees who were
in occupation on 1.2.1973. (para 9] (496-C-E]
1.2 The General Insurance Business (Nationalisation)
Act, 1972 was passed on 20.9.1972. Section 16 of this Act
contemplated the merger of the private insurance
companies into certain other insurance companies.
Indian Mercantile Insurance Company Ltd., original
H
484
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A owner in the instant case, merged into the first
respondent-Oriental Insurance Company Ltd. w.e.f.
1.1.197 4. In view of the merger of the erstwhile insurance
company into the first respondent, (of which not less than
51 per cent share holding was that of the Central
B Government), the Public Premises Act became applicable
to its premises. [Para 10 and 12) [497-i=; 498-B; 500-F]
Accountant and Secretarial Services Pvt. Ltd. Vs. Union
of India 1988 (1) Suppl. SCR 493 =1988 (4) SCC 324, and
C Smt. Saiyada Mossarrat Vs. Hindustan Steel Ltd. 1988 (3)
Suppl. SCR 690 = 1989 (1) SCC 272 - cited.
1.3 In Ashoka Marketing Ltd., this Court has observed
that the Rent Control Act and the Public Premises Act
operate in two different areas, and the properties
D 'belonging to' the Central Government, Government
Companies or Corporations would be excluded from the
application of the Rent Control Act. [para 23) [509-F-G]
Ashoka Marketing Ltd. Vs. Punjab National Bank 1990
E (3) SCR 649 = 1990 (4) SCC 406 - referred to.
2.1 Section 19 of the Public Premises Act, 1971
repeals the Public Premises (Eviction of Unauthorised
Occupants) Act, 1958. Section 1 (3) of the 1971 Act lays .
down that it shall be deemed to have come into force on
F the 16th day of September, 1958 except ss. 11, 19 and 20
which shall come into force at once (i.e. from 23.8.1971).
A conjoint reading of s. 1(3) and s. 2(e) defining 'public
premises' will be that although the provisions with
respect to eviction under the Act of 1971 are deemed to
G have come into force from 16.9.1958, they will apply to the
premises concerned only from the date when they
become public premises. [para 26) [512-G-H; 513-A-C)
Rashtriya Mill Mazdoor Sangh, Nagpur vs. Model Mills,
H Nagpur and Anr. 1985 SCR 751 = AIR 1984 SC 1813; and
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. 485
LTD. AND ITS ESTATE OFFICER
Bhuri Nath and Ors. vs. State of J&K and Ors. 1997 (1) SCR
A
138 =AIR 1997 SC 1711 - relied on.
M. Mohd vs. Union of India AIR 1982 Bombay 443;
Mahomed Amir Ahmad Khan vs. Municipal Board of Sitapur,
AIR 1965 SC 1923 -- distinguished
B
'History of Insurance of India' published by Insurance
Regulatory and Development Authority' (/RDA) on its official
website on 12.07.2007 under Ref: IRDAIGEN/0612007 -
referred to.
2.2 The Public Premises Act, provides a speedy
remedy to recover the premises from unauthorised
occupants. At the same time, it must also be noted that
c
the appellant is seeking protection uls 15A of the Bombay
Rent Act, which has a non-obstante clause. The o
provisions of the two enactments will have to be read
harmoniously to permit the operation and co-existence
of both of them to the extent it can be done. Therefore,
the term 'belonging to' as occurring in the definition of
public premises in s. 2(e) will have to be interpreted
E
meaningfully to imply only the premises owned by or
taken on lease by the Government Company at the
relevant time. In the facts of the case, the appellant had
F
the status of a deemed tenant under the Bombay Rent
Act, 1947 w.e.f. 1.2.1973, i.e., prior to the premises
'belonging to a Government Company' and becoming
public premises, i. e. 1.1.1974. If at all he had to be
evicted, it was necessary to follow the due process of law
which would mean the process as available under the
Bombay Rent Act or its successor Maharashtra Rent
Control Act, 1999, and not the one which is provided G
under the provisions of the Public Premises Act. [Para 30)
[518-D, G; 519-A-D]
3.1 It has been laid down by this Court time and again
that if there are rights created in favour of any person,
H
486
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A whether they are property rights or rights arising from a
transaction in the nature of a contract, and, particularly,
if they are protected under a statute, and if they are to be
taken away by any legislation, that legislation will have to
say so specifically by giving it a retrospective effect, as
B prima facie every legislation is prospective. In the instant
case, the appellant was undoubtedly protected as a
'deemed tenant' u/s 15A of the Bombay Rent Act, prior to
the merger of the erstwhile insurance company with a
Government Company, and he could be removed only by
c following the procedure available under the Bombay Rent
Act. A 'deemed tenant' under the Bombay Rent Act,
. continued to be protected under the succeeding Act, in
view of the definition of a 'tenant' u/s 7(15)(a)(ii) of the
Maharashtra Rent Control Act, 1999. Thus, as far as the
0 tenants of the premises which are not covered under the
Public Premises Act are concerned, those occupants who
were deemed tenants under the Bombay Rent Act,
continued to have their protection under the Maharashtra
Rent Control Act, 1999, notwithstanding s. 15 of the
E Public Premises Act, which creates a bar of jurisdiction
to entertain suits or proceedings in respect of eviction of
any person in an unauthorised occupation. The Public
Premises Act will apply only to those who come in such
occupation. after the date of the premises becoming
public premises. [para 31 and 45] [519-H; 520-A-D; 530F C, E]
Janardan Reddy vs. The State 1950 SCR 940 = AIR 1951
SC 124; Garkiapati Veeraya vs. N. Subbiah Choudhry, in
1957 SCR 488 =AIR 1957 SC 540; Mahadeola/ Kanodia vs.
G The Administrator General of West Bengal 1960 SCR 578 =
AIR 1960 SC 936; K.S. Paripooman vs. State of Kera/a, AIR
1995 SC 1012; and Gajraj Singh vs. State Transport
Appellate Tribunal 1996 (6) Suppl. SCR 172 =AIR 1997 SC
412 - relied on.
H
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO. 487
LTD. AND ITS ESTATE OFFICER
A
Amireddi Raja Gopala Rao vs. Amireddi Sitharamamma,
1965 SCR 122 =AIR 1965 SC 1970; J.P. Jani, Income Tax
Officer, Circle IV, Ward G, Ahmedabad vs. lnduprasad
Devshanker Bhatt, 1969 SCR 714 =AIR 1969 SC 778; ExCapt., K.C. Arora vs. State of Haryana 1984 (3) SCR 623 =
1984 (3) SCC 281; and Arjan Singh vs. State of Punjab 1969
B
SCR 347 =AIR 1970 SC 703 - referred to.
3.2 For any premises to become public premises, the
relevant date will be 16.9.1958 or the date on which the
premises become public premises as belonging to or c
taken on lease by LIC or the Nationalised Banks or the
General Insurance Companies like the first respondent,-
whichever is later. All those persons falling within the
definition of a tenant occupying the premises prior
thereto will not come under the ambit of the Public 0
Premises Act and cannot, therefore, be said to be persons
in "unauthorised occupation". Whatever rights such prior
tenants, members of their families or heirs of such
tenants or deemed tenants or all of those who fall within
the definition of a tenant under the Bombay Rent Act
have, are continued under the Maharashtra Rent Act.· If E
possession of premises in their occupation is required,
that will have to be resorted to by taking steps under th~
Bombay Rent Act or Maharashtra Rent Act. If person
concerned has come in occupation subsequent to such
date, tben of course the Public Premises Act will apply.
[para 44] [529-F-H; 530-A-BJ
F
3.3 The appellant's status as a deemed tenant was
accepted under the State enactment and, therefore, he
could not be said to be in "unauthorised occupation". His
G
right granted by the State enactment cannot be destroyed
by givjng any retrospective application to the provisions
.of Public Premises Act, since there is no such express
provision in the statute, nor is it warranted by any
implication. In fact his premises would not come within
H
488
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A the ambit of the Public Premises Act, until they belonged
to respondent No. 1, i.e until 1.1.197 4. The corollary is that
if respondent No. 1 wanted to evict the appellant, the
remedy was to resort to the procedure available under
the Bombay Rent Act or its successor Maharashtra Rent
B Control Act, by approaching the forum thereunder, and
not by resorting to the provisions of the Public Premises
Act. [para 39] [524-H; 525-A-C]
Banatwala and Co. vs. UC 2011 (14) SCR 533 = 2011
C (13) SCC 446; Jain Ink Manufacturing Company v. L.l.C 1981
(1) SCR 498 = (1980) 4 SCC 435 - referred to.
Chandavarkar Sita Ratna Rao Vs. Asha/ata S. Guram,
1986 (3) SCR 866 - cited.
0
4.1 In Ashoka Marketing, the Constitution Bench has
observed that the Public Premises Act is enacted to deal
with mischief of 'rampant unauthorised occupation' of
public premises. It is significant to note that there has
been a criticism of the use of the powers under the Public
E Premises Act, and the manner in which they are used in
an arbitrary way to evict the genuine tenants from the
public premises causing serious hardships to them. The
Central Government has therefore, issued the guidelines·-
by Resolution No. 21012/1/2000-Pol.1, dated 30-5-2002, to
prevent such arbitrary use of these powers. It is
F emphasized in Clause 2(i) of the guidelines that the Act
was meant to evict: (a) totally unauthorised occupants of
the public premises or subletees, or (b) employees who
have ceased to be in their service, and were ineligible to
occupy the premises. Clause 2 (iii) indicates that for
G resuming possession in certain situations, where the
tenants are protected under the State Rent Control Act
prior to the Public Premises Act becoming applicable, the
public authorities will have to move under the Rent
Control Acts on the grounds which are available to the
H private landlords. The powers are given to act for
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE
489
CO. LTD. AND ITS ESTATE OFFICER
specified reasons, and are expected to be used only in
A
justified circumstances and not otherwise. [para 40-43]
[525-D-H; 527-G; 528-B, C-D; 529-C]
New Insurance Assurance Company vs. Nusli Neville
Wadia 2007 (13) SCR 598 = 2008 (3) SCC 279 - referred
to.
B
4.2 As far as the eviction of unauthorised occupants
from public premises is concerned, it is covered under
the Public Premises Act, but it is so covered from
16.9.1958, or from the later date when the premises
C
concerned become public premises. Thus, there are two
categories of occupants of the public corporations who
get excluded from the coverage of the Act itself. Firstly,
those who are in occupation since prior to 16.9.1958, i.e.
prior to the Act becoming applicable, are clearly outside
D
the coverage of the Act. Secondly, those who come in
occupation, thereafter, but prior to the date of the
premises belonging to a Government Corporation or a
Company, and are covered under a protective provision
F
of the State Rent Act, like the appellant, also get. E
excluded. Until such date, the Bombay Rent Act and its
successor Maharashtra Rent Control Act will continue to
govern the relationship between the occupants of such
premises on the one hand, and such government
companies and corporations on the other. Therefore, with
respect to such occupants it will not be open to such
companies or corporations to issue notices, and to
proceed against such occupants under the Public
Premises Act, and such proceedings will be void and
illegal. Similarly, it will be open for such occupants of
these premises to seek declaration of their status, and
G
other rights such as transmission of the tenancy to the
legal heirs etc. under the Bombay Rent Act or its
successor Maharashtra Rent Control Act, and also to
seek protective reliefs in the nature of injunctions against
unjustified actions or orders of eviction if so passed, by
H
490
SUPREME COURT REPORTS
[2014) 2 S.C.R.
A approaching the forum provided' under the State Act
which alone will have the jurisdiction to entertain such
proceedings. [para 48] [532-C-H; 533-A]
Pradip Chandra Parija vs. Pramod Chandra, 2001 (5)
B Suppl. SCR 460= 2002 (1) SCC 1; Sundarjas Kanya/a/
Bhatija vs. Collector, Thane, Maharashtra and Ors. 1989 (3)
SCR 405 =1989 (3) sec 396 - cited.
4.3 Since the issue of retrospective application of the
Public Premises Act, to tenancies entered into before
C 16.9.1958, or before the property in question becoming a
public premises, was neither canvassed nor considered
by the Constitution Bench in Ashoka Marketing, the
decision does not, in any way, prevent this Court from
D
E
clarifying the law regarding the same. [para 51] [535-D-E]
State of Haryana vs. Ranbir@ Rana, 2006 (3) SCR 864
= (2006) 5 SCC 167; and Commissioner of Income Tax vs.
Mis. Sun Engineering Works (P.) Ltd. 1992 (1) Suppl. SCR
732 = AIR1993 SC 43 - referred to.
4.4 The impugned judgment and order dated 7.6.2010
rendered by the High Court is set aside. The writ petition
shall stand allowed, and the judgment and order dated
17.1.1996 passed by the City Civil Court, Mumbai, as well
as the eviction order dated 28.5.1993 passed by
F respondent No. 2 against the appellant will stand set
aside. The proceedings for eviction from premises, and
for recovery of rent and damages initiated by the first
respondent against the appellant under the Public
Premises Act, 1971, are held to be bad in law, and shall
G therefore stand dismissed. However, it is made clear that
in case the respondents intend to take any steps for that
purpose, it will be open to them to resort to the remedy
available under the Maharashtra Rent Control Act, 1999.
[para 52) [536-E-G]
H
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE
491
CO. LTD. AND ITS ESTATE OFFICER
Case Law Reference:
A
1990 (3) SCR 649
referred to
para 7
1988 (1) Suppl. SCR 493
referred to
para 19
1988 (3) Suppl. SCR 690
referred to
para 19 ·
B
1986 (3) SCR 866
cited
para 25
AIR 1982 Bombay 443
distinguished
para 28
AIR 1965 SC 1923
distinguished
para 28
c
1985 SCR 751
relied on
para 29
1997 (1) SCR 138
relied on
para 29
1950 SCR 940
relied on
para 31
1957 SCR 488
relied on
para 32
D
1960 SCR 578
relied on
para 33
1965 SCR 122
referred to
para 34
1969 SCR 714
referred to
para 34
E
1969 SCR 347
referred to
para 35
1984 (3) SCR 623
referred to
para 36
AIR 1995 SC 1012
relied on
para 37
F
1996 (6) Suppl. SCR 172
relied on
para 38
2007 (13) SCR 598
referred to
para 43
2011 (14) SCR 533
referred to
para 46
1981 (1) SCR 498
referred to
para 47
G
2001 (5) Suppl. SCR 460
cited
para 49
1989 (3) SCR 405
cited
para 49
H
A
B
c
D
492
SUPREME COURT REPORTS
2006 (3) SCR 864
referred to
1992 (1) Suppl. SCR 732
referred to
[2014] 2 S.C.R.
para 51
para 51
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
1970 of 2014.
From the judgment and order dated 07.06.2010 of the
High Court of Bombay in WP No. 2473 of 1996.
R.F. Nariman, Gaurav Goel, Manasi Kumar, Manu
Aggarwal (for E.C. Agrawala) for the Appellant.
Harin P. Raval, Pramod Dayal, Nikunj Dayal, Payal Dayal,
S.M. Suri, P.S. ,Johar, Divya Anand for the Respondents.
The Judgment of the Court was delivered by
H.L. GOKHALE J. 1. Leave granted.
2. This appeal by special leave raises the question as to
whether the rights of an occupant/licensee/ tenant protected
under a State Rent Control Act (Bombay Rent Act, 1947 and
E its successor the Maharashtra Rent Control Act, 1999, in the
instant case), could be adversely affected by application of.1he
Public Premises (Eviction of Unauthorised Occupants) Act,
1971 ('Public Premises Act' for short)? This question arises in
the context of the eviction order dated 28.5.1993 passed by
F the respondent No. 2, Estate Officer of the first respondent,
invoking the provisions of the Public Premises Act with respect
to the premises occupied by the appellant since 20.12.1972.
The eviction order has been upheld by the Bombay High Court
in Jts impugned judgment dated 7:6.2010, rejecting the Writ
G Petition No.2473 of 1996 filed by the appellant herein.
The facts leading to this appeal are this wise:-
3. One Mr. Eric Voller was a tenant of the Indian Mercantile
Insurance Company Ltd. (hereinafter referred to as the
H erstwhile Insurance Co.), the predecessor in title of the first
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO.
493
LTD. AND ITS ESTATE OFFICER [H.L. GOKHALE, J.]
respondent in respect of the premises being Flat No.3, Second
Floor, Indian Mercantile Mansion (formerly known as Waterloo
Mansion), Wodehouse Road, Opposite Regal Cinema, Colaba,
Mumbai. This Mr. Voller executed a leave and licence
agreement in respect of these premises on 20.12.1972 in
favour of the appellant initially for a period of two years, and
put him in exclusive possession thereof. Mr. Voller, thereafter
migrated to Canada with his family. The appellant is a practicing
physician. The erstwhile insurance company did not object to
A
B
the appellant coming into exclusive possessio~ qf ,t~e said
premises. In fact, it is the case of the appellant that when Mr.' c
Voller sought the transfer of the tenancy to the appellant, the
General Manager of the said insurance company, by his reply
dated 16.1.1973, accepted the appellant as the tenant, though
for residential purposes only. The said erstwhile insurance
company, thereafter, started accepting the rent directly from the
appellant. It is also the case of the appellant that on 14.3.1973,
he wrote to the said General Manager seeking a ·permission
for a change of user i.e. to use the premises for his clinic. It is
also his case that on_ 18.4.1973, the General Manager wrote
back to him that the erstwhile insurance company had no
objection to the change of user, provided the Municipal
Corporation of Greater Mumbai gave no objection.
4. The erstwhile insurance company subsequently merged
D
E
on 1.1.197 4 into the first respondent company which is a
Government Company. The management of the erstwhile
F
insurance company had however been taken over by the
Central Government with effect from 13.5.1971, pending its
nationalisation and that of other private insurance companies.
The first respondent, thereafter, addressed a notice dated
12.7.1980 to Mr. E. Voller terminating his tenancy with respect
G
to the said premises, and then filed a suit for eviction against
Mr. E. Voller and the appellant being R.A.E. Suit No.1176/3742
of 1981 in the Court of Small Causes at Mumbai, under the
provisions of the then applicable Bombay Rents, Hotel and
Lodging Houses Rates Control Act, 1947 ('Bombay Rent Act'
H
494
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A for short). Initially the suit came to be dismissed for default, but
an application was made under Order 9 Rule 9 of Code of Civil
Procedure to set aside the said order. The application was
allowed, and the suit remained pending.
B
5. The appellant then sent a letter dated 22.11.1984 to the
first respondent requesting them to regularize his tenancy as a
statutory tenant. The first respondent, however, served the
appellant notices under Section 4 and 7 of the Public Premises
Act, to show cause as to why he should not be evicted from
C the concerned premises, and to pay damages as specified
therein for unauthorised occupation as claimed. The first
respondent followed it by preferring Case No.10 and 1 OA of
1992 before the respondent No. 2 Estate Officer under the
Public Premises Act, to evict Mr. E. Voller and the appellant,
and also to recover the damages. After initiating these
D proceedings, the first respondent withdrew on 22.2.1994 the
suit filed in the Court of Small Causes. It is, however, relevant
to note that in paragraph No. 4 of their case before the Estate
Officer, the first respondent specifically accepted that Mr. E.
Voller had sublet or given on leave and licence basis or
E otherwise transferred his interest in the said flat to the appellant
in or about 1972, though without any authority from the
respondent No. 1. The first respondent alleged that the
appellant had carried out structural changes. The appellant
denied the allegation. He claimed that he had effected some
F essential minor repairs for maintenance of the premises since
the first respondent was neglecting to attend the same. The
appellant filed a reply pointing out that he had been accepted
as a tenant by the predecessor of the first respondent by their
earlier referred letter dated 16.1.1973. The first respondent,
G however, responded on 5.1.1993 stating that they did not have
any record of the erstwhile insurance company prior to 1975.
The second respondent thereafter passed an order on
28.5.1993 directing eviction of Mr. E. Voller and the appellant,
and also for recovery of damages at the rate of Rs.6750 per
H month from 1.9.1980.
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO.
495
LTD. AND ITS ESTATE OFFICER [H.L. GOKHALE, J.]
6. Being aggrieved by the said order, the appellant filed
A
an appeal before the City Civil Court at Mumbai under Section
9 of the Public Premises Act, which appeal was numbered as
Misc. Appeal No.79/93. The City Civil Court set aside the order
of damages, and remanded the matter to the second
respondent to reconsider that aspect, but upheld the order of
B
eviction by its judgment and order dated 17 .1.1996. The
appellant thereupon filed a writ petition bearing No.2473/1996
before the High Court on 15.4.1996 to challenge that part of
the appellate order which upheld the order of eviction. The High
Court dismissed the Writ Petition, by the impugned judgment c
and order dated 7.6.2010, with costs.
7. The principal contention raised by the appellant right
from the stage of the proceedings before the respondent No.
2, and even before the High Court, was that his occupation of
. the concerned premises was protected under the newly added
D
S 15A of the Bombay Rent Act with effect from 1.2.1973, i.e.
prior to the first respondent acquiring the title over the property
from 1.1.1974. Therefore, he could not be evicted by invoking
the provisions of Public Premises Act, and by treating him as
an unauthorised occupant under that act. The impugned order
E
of the High Court rejected the said submission holding that the
provisions of the ijombay Rent Act were not applicable to the
premises concerned, and the said premises were covered
under the Public Premises Act. The High Court principally relied
upon the judgment of a Constitution Bench of this Court in
F
Ashoka Marketing Ltd. Vs. Punjab National Bank reported in
1990 (4) SCC 406. As per the view taken by the High Court,
this judgment rejects the contention that the provisions of the
Public Premises Act cannot be applied to the premises which
fall within the ambit of a State Rent Control Act. The High Cou1t
G
held that the Public Premises Act became applicable to the
concerned premises from 13.5.1971 itself i.e. the appointed
date under the General Insurance (Emergency Provisions) Act,
1971 wherefrom the management of the erstwhile insurance
company was taken over by the Central Government, and not
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SUPREME COURT REPORTS
(2014] 2 S.C.R.
A from the date of merger i.e. 1.1.1974. It is this judgment which
is under challenge in the present appeal.
8. Mr. Rohinton F. Nariman, learned senior counsel has
appeared for the appellant and Mr. Harin P. Raval, learned
B senior counsel has appeared for the respondents.
The principal issue involved in the matter:-
9. To begin with, it has to be noted that the relationship
between the erstwhile insurance company as the landlord and
c the appellant as the occupant, at all material times was
governed under the Bombay Rent Act. Like all other rent control
enactments, this Act has been passed as a welfare measure,
amongst other reasons to protect the tenants against unjustified
increases above the standard rent, to permit eviction of the
o tenants only when a case is made out under the specified
grounds, and to provide for a forum and procedure for
adjudication of the disputes between the landlords and the
tenants. The legislature of Maharashtra thought it necessary to
protect the licensees also in certain situations. Therefore, this
E act was amended, and a section was inserted therein bearing
Section No.15A to protect the licensees who were in
occupation on 1.2.1973. This Section reads as follows:-
F
"15A. Certain licensees in occupation on 1st February
1973 to become tenants
(1) Notwithstanding anything contained elsewhere in this
Act or anything contrary in any other law for the time
being in force, or in any contract where any person is on
the 1st day of February 1973 in occupation of any
G
premises, or any part thereof which is not less than a
room, as a licensee he shall on that date be deemed to
have become, for the purpose of this Act, the tenant of
the landlord, in respect of the premises or part thereof,
in his occupation.
H
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO.
497
LTD. AND ITS ESTATE OFFICER [H.L. GOKHALE, J.]
(2) The provisions of sub-section (1) shall not affect in any
A
manner the operation of sub-section (1) of section 15 after
the date aforesaid. "
We may note that S 15(1) prohibits sub-letting of premises.
10. As far as the insurance business in India is concerned,
prior to independence, it was owned and operated by private
entities. The governing law for insurance in India was, and still
B
is the Insurance Act, 1938. Post-independence, the Industrial
Policy Resolution of 1956 stated that the Life Insurance industry
in India was to be nationalised. Therefore, the Life Insurance
C
Corporation Act of 1956 was passed creating the Life Insurance
Corporation (UC), as a statutory corporation, and transferring
the assets of all the private life insurance companies in India
to UC. Sometimes around 1970-71, it was felt that the general
insurance industry was also in need of nationalisation.
Therefore, first the General Insurance (Emergency Provisions)
Act, 1971 was passed by the Parliament which provided for the
taking over of the management of general insurance business.
Though the Act received the assent of the President on
17.6.1971, it was deemed to have come into force on
13.5.1971 from which date the Central Government assumed
the management of General Insurance Business as an initial
step towards the nationalisation. Thereafter, the General
Insurance Business (Nationalisation) Act, 1972 was passed on
20.9.1972. Section 16 of this Act contemplated the merger of
the private insurance companies into certain other insurance
companies. Consequently, these private insurance companies
merged into four insurance companies viz.,
(a)
The National Insurance Company Ltd.,
(b)
The New India Assurance Company Ltd.,
(c)
The Oriental Insurance Company Ltd., and
(d)
The United India Insurance Company Ltd.
D
E
F
G
H
498
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
These four companies are fully owned subsidiaries of the
General Insurance Corporation of India which is a Government
Company registered under Companies Act, 1956, but
incorporated as mandated under Section 9 of the above
referred Nationalisation Act. The Central Government holds not
B less than 51 per cent of the paid up share capital of the General
Insurance Corporation. The above referred Indian Mercantile
Insurance Company Ltd. merged into the first respondentOriental Insurance Company Ltd. w.e.f. 1.1.197 4.
11. There is one more important development which is
C required to be noted. The Public Premises Act, 1971 (40 of
1971) came to be passed in the meanwhile. As per its
preamble, it is "an act to provide for eviction of unauthorised
occupants from public premises and for certain incidental
matters" such as removal of unauthorised construction, recovery
D of arrears of rent etc. It came into force on 23.8.1971, but
Section 1 (3) thereof states that it shall be deemed to have
come into force on 16.9.1958, except Section 11 (on offences
and penalty) and Sections 19 and 20 (on repeal and validation).
This is because from 16.9.1958, its predecessor Act viz. The
E Public Premises (Eviction of Unauthorised Occupants) Act (32
of 1958) was in force for similar purposes, and which was
repealed by the above referred Section 19 of the 1971 Act. As
provided under Section 2 (e) (2) (i) of this Act, the definition of
'Public Premises', amongst others, covers the premises
F belonging to or taken on lease by or on behalf of any company
in which not less than fifty one per cent of the paid up share
capital was held by the Central Government. The definition of
public premises under Section 2(e) of this Act reads as
follows:-
G
"2. Definitions .....
[(e) ''public premises" means-
(1) any premises belonging to, or taken on lease or
H
requisitioned by, or on behalf of, the Central
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO.
499
LTD. AND ITS ESTATE OFFICER [H.L. GOKHALE, J.]
Government, and includes any such premises A
which have been placed by the Government,
whether before or after the commencement of the
Public Premises (Eviction of Unauthorised
Occupants) Amendment Act, 1980, under the
control of the Secretariat of either House of B
Parliament
for
providing
residential
accommodation to any member of the staff of that
Secretariat;
(2) any premises belonging to, or taken on lease by, or C
on behalf of,-
(i)
any company as defined in Section 3 of the
Companies Act, 1956 (1 of 1956), in which not less
than fifty-one per cent of the paid-up share capital
is held by the Central Government or any company D
which is a subsidiary (within the meaning of that Act)
of the first-mentioned company,
(ii)
any Corporation [not being a company as defined
(iii)
(iv)
(v)
(vi)
in Section 3 of the Companies Act, 1956 (1 of E
1956), or a local authority] established by or under
a Central Act and owned or controlled by the Central
Government,
any University established or incorporated by any
Central Act,
any Institute incorporated by the Institutes of
Technology Act, 1961 (59 of 1961 ),
any Board of Trustees constituted under the Major
Port Trusts Act, 1963 (38 of 1963),
the Bhakra Management Board constituted under
Section 79 of the Punjab Reorganisation Act, 1966
(31 of 1966), and that Board as and when renamed
as the Bhakra-Beas Management Board under subF
G
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500
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
section (6) of Section 80 of that Act;
B
c
D
E
[(vii) any State Government or the Government of any
Union Territory situated in the National Capital
Territory of Delhi or in any other Union Territory;
(viii) any Cantonment Board consitituted under the
Cantonments Act, 1924 (2 of 1924); and]
(3) in relation to the [National Capital Territory of Delhi],-
(i)
any premises belonging to the Municipal
Corporation of Delhi, or any municipal committee
or notified area committee,
(ii)
any premises belonging to the Delhi Development
Authority, whether such premises are in the
possession of, or leased out by, the said Authority,
[and]
[(iii) any premises belonging to, or taken on lease or
requisitioned by, or on behalf of any State
Government or the Government of any Union
Territory;]"
12. The consequence of this development was that in view
of the merger of the erstwhile insurance company into the first
respondent, (of which not less than 51 per cent share holding
F was that of the Central Government,) the Public Premises Act
became applicable to its premises. It is the contention of the
appellant that although the Act is otherwise deemed to have
come into force from 16.9.1958, as far as the present premises
are concerned, the Act became applicable to them from
G 1.1.197 4 when the erstwhile insurance company merged into
the first respondent. Then only it could be said that the premises
'belonged' to a Government Company. However, since the
appellant's occupation of the said premises was protected by
Section 15A of the Bombay Rent Act which Section had
H become enforceable prior thereto from 1.2.1973, he could not
DR. SUHAS H. POPHALE v. ORIENTAL INSURANCE CO.
501
LTD. AND ITS ESTATE OFFICER [H.L. GOKHALE, J.]
be said to be in 'unauthorised occupation' and, therefote, could
A
not be evicted by invoking the provisions of the Public Premises
Act. On the other hand, the contention of the respondents is that
the Public Premises Act became applicable to the concerned
premises from 13.5.1971 itself, when the management of the
erstwhile insurance company was taken over by the Central
B
Government, and the rejection of the writ petition by the High
Court on that ground was justified. The principal issue involved
in this matter is thus about the applicability of the Public
Premises Act to the premises occupied by the appellant.
Submissions of the rival counsel:-
13. Learned Senior Counsel for the appellant, Mr. Nariman
submitted that the finding of the High Court that the Public
Premises Act applies to these premises from 13.5.1971 was
c
an erroneous one.