# Roshan Lil .Mehra v. la.%U'ar Das

- **Citation:** [1962] 2 S.C.R. 947
- **Court:** Supreme Court of India
- **Decided:** 1962
- **Bench:** B. P. Sinha; C.J, S.K. Das, A. K .. Sarkar; N_, RAJAGOPALA AYYANGAR 'lnd J.R; 1\IuDHOLKAR
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/roshan-lil-mehra-v-la-u-ar-das-2310
- **Pages:** 37

## Headnote

Standard rent, (fixati<m of-Neirly Constructed .and old
buildings-Cla8sification, if· .-iolatii-e of fundamental right and
principksof natural.iustice-:-Constitution of India, Art •. 14-:-
Delhi and Ajmer-Marwara Rent Control Act, 1947 (Act XIX of
1941), SS. 7, 7A, Sch. IV.
.
.
··. The ·appellants applied to the Rent Controller· for' ·fixa.
tion of fair and standard rent of certain shops and other
premises alleging that the rent charged by the landlords was
exorbitant.
The questions arising for detennination were .
(I) wbethei; the Delhi and Ajmer-Marwara Rent Control Act,
1947· in so far as it provided for the fixation of standard rent
in respect of premises the construction of which was completed
after March 24," 1947 by the Rent Controller violated the
fundamental right guaranteed under'Art. 14 of the Constitution; and (2) whether the procedure to be followed by the Rent
Controller violated the principles of natural justice •.
Held, thats. 7Aand the relevant provisions of Sch. IV
of the Act laying down the proce<Jure for fixing standard rent
by t!JJ' Rent Controller are not· unconstitutional and do not
violate Art. 14 of the Constitution. The classification between
premises the ·construction of which was completed before
March 24, 1947.when the Act came into force and those which
•
\\·ere_ completed :thereafter, is reasonable,. and the cr~teria for
the fixation ·-Of-standard rent for both old and new buildings·
under tl:e Act were not substantially different.
·
.. ·.-.. The. procedure laid down Wider those provisions docs not
:.violate the principles of natural juatice.~ The power given to
the Rent Controller is not arbitraiy and he has to exercise it
on a judicial_ consideration of all the cir.<UJDstar.~cs of th_e caoc.
, .
·--~--
_ kanslii&.m
Jagardfoth.,
-_.' V.•. ; •. ~
Tht Stiitt
HidayatuUah J •
1961
-
A1Jgust 2.
1961
Roshan Lil
.Mehra
v.
la.%U'ar Das
948
SUPREME COURT REPORTS
(1962]
G.D. Soni v. 8. N. Bhalla, A.LR.
1959 Punj. 381
approved.
.J..''e.u) Prakash Transport Co.
Ltd.
v.
}{eu• Suuiarna
TransPorl Co. Ltd., (1957) S.C.R. 98, Union of India v. T.R.
Verma (1958) S.C.R. 499 followed.
In the instant case ample opportunity was given to the
landlord for producing all relevant evidence in the case which
he did not avail him<elf of. It was not necessary under para
2, Sch. IV, to have two enquiries one for ascertaining whether
there were good reasons for believing that the rent charged
was exorbitant and another for fixing the standard rent.
The proceedings before the Rent Controller were not
vitiated merely because standard rent of certain vacant shops
was also fixed in the process of fixing the standard rent for the
entire building in \\•hirh those shops were situated; that \vould
not affect the le~ality of the fixation of the rent for the shops
which had heen let out to tenants.
CrnL APPELLATE JURISDICTION: Civil Appeal
No. 171 of 1958.
Appeal by sp0cial leave from the Judgment
and order dated March 7, 1956, of the Punjab High
Court (Circuit Bench) at Delhi in Civil Misc. No.
249-D of 1956.
WITH
Oivil Appeals Nos. 172 to 186 of 1958.
Appeals from the judgment and order dated ·
August 26, 1954, of the Punjab High Court in Civil
Revisions Nos. 243, 274, 276, 277, 281 to 286, 288,
290 and 293 and 295 of 1951.
Anoop Singh, for the
appellant in Civil
Appeal No. 171 of 1958.
Basant Kitrnar Jaggi, for the r11spondent.
(In Civil Appal" Nos. 172 to 186 of 1958).
A. V. Viswanatha Sastri, R. Ganapathy Iyer
anrl G. Gopalakrishnan, for the appellants in Civil
Appeale Xos. 172 to 186 of 1958.
C. K. D(tphta.ry, Solicitor General of India,
C.R. Aggarw,~la and K.P. Gupta, for the respondents
Nos. 1 to 4.
,
t
I
2 S.C.R.
SUPREME COURT REPORTS
949
19fil. August 2. The Judgment of the Court
was delivered by
S. K. DAS, .J.-These are 16 apiieals which
have been heard together. For facility of considering them on merits, it would be convenient to
classify them into three categories. In the first
category fall Civil Appeals Nos. 172 to 184

## Text

_Characters 0–39,857 of 70,919. This is a partial read: ask again with offset=39857 for what follows._

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2 s.c.R .
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SUPRE~ffi COURT REPORTS---;947--
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.
In ·our judgment, the· decision of the High
Court is . correct; · and the appeal is dismissed with
costs.·
.Appeal dismissed.
---
. ROSHAN LAL 1\IEHRA
ISHWAR DAS.
(B. P. SINHA; C.J., S.K. DAS,
A. K .. SARKAR;
N_, RAJAGOPALA AYYANGAR 'lnd J.R; 1\IuDHOLKAR, JJ.)
Standard rent, (fixati<m of-Neirly Constructed .and old
buildings-Cla8sification, if· .-iolatii-e of fundamental right and
principksof natural.iustice-:-Constitution of India, Art •. 14-:-
Delhi and Ajmer-Marwara Rent Control Act, 1947 (Act XIX of
1941), SS. 7, 7A, Sch. IV.
.
.
··. The ·appellants applied to the Rent Controller· for' ·fixa.
tion of fair and standard rent of certain shops and other
premises alleging that the rent charged by the landlords was
exorbitant.
The questions arising for detennination were .
(I) wbethei; the Delhi and Ajmer-Marwara Rent Control Act,
1947· in so far as it provided for the fixation of standard rent
in respect of premises the construction of which was completed
after March 24," 1947 by the Rent Controller violated the
fundamental right guaranteed under'Art. 14 of the Constitution; and (2) whether the procedure to be followed by the Rent
Controller violated the principles of natural justice •.
Held, thats. 7Aand the relevant provisions of Sch. IV
of the Act laying down the proce<Jure for fixing standard rent
by t!JJ' Rent Controller are not· unconstitutional and do not
violate Art. 14 of the Constitution. The classification between
premises the ·construction of which was completed before
March 24, 1947.when the Act came into force and those which
•
\\·ere_ completed :thereafter, is reasonable,. and the cr~teria for
the fixation ·-Of-standard rent for both old and new buildings·
under tl:e Act were not substantially different.
·
.. ·.-.. The. procedure laid down Wider those provisions docs not
:.violate the principles of natural juatice.~ The power given to
the Rent Controller is not arbitraiy and he has to exercise it
on a judicial_ consideration of all the cir.<UJDstar.~cs of th_e caoc.
, .
·--~--
_ kanslii&.m
Jagardfoth.,
-_.' V.•. ; •. ~
Tht Stiitt
HidayatuUah J •
1961
-
A1Jgust 2.
1961
Roshan Lil
.Mehra
v.
la.%U'ar Das
948
SUPREME COURT REPORTS
(1962]
G.D. Soni v. 8. N. Bhalla, A.LR.
1959 Punj. 381
approved.
.J..''e.u) Prakash Transport Co.
Ltd.
v.
}{eu• Suuiarna
TransPorl Co. Ltd., (1957) S.C.R. 98, Union of India v. T.R.
Verma (1958) S.C.R. 499 followed.
In the instant case ample opportunity was given to the
landlord for producing all relevant evidence in the case which
he did not avail him<elf of. It was not necessary under para
2, Sch. IV, to have two enquiries one for ascertaining whether
there were good reasons for believing that the rent charged
was exorbitant and another for fixing the standard rent.
The proceedings before the Rent Controller were not
vitiated merely because standard rent of certain vacant shops
was also fixed in the process of fixing the standard rent for the
entire building in \\•hirh those shops were situated; that \vould
not affect the le~ality of the fixation of the rent for the shops
which had heen let out to tenants.
CrnL APPELLATE JURISDICTION: Civil Appeal
No. 171 of 1958.
Appeal by sp0cial leave from the Judgment
and order dated March 7, 1956, of the Punjab High
Court (Circuit Bench) at Delhi in Civil Misc. No.
249-D of 1956.
WITH
Oivil Appeals Nos. 172 to 186 of 1958.
Appeals from the judgment and order dated ·
August 26, 1954, of the Punjab High Court in Civil
Revisions Nos. 243, 274, 276, 277, 281 to 286, 288,
290 and 293 and 295 of 1951.
Anoop Singh, for the
appellant in Civil
Appeal No. 171 of 1958.
Basant Kitrnar Jaggi, for the r11spondent.
(In Civil Appal" Nos. 172 to 186 of 1958).
A. V. Viswanatha Sastri, R. Ganapathy Iyer
anrl G. Gopalakrishnan, for the appellants in Civil
Appeale Xos. 172 to 186 of 1958.
C. K. D(tphta.ry, Solicitor General of India,
C.R. Aggarw,~la and K.P. Gupta, for the respondents
Nos. 1 to 4.
,
t
I
2 S.C.R.
SUPREME COURT REPORTS
949
19fil. August 2. The Judgment of the Court
was delivered by
S. K. DAS, .J.-These are 16 apiieals which
have been heard together. For facility of considering them on merits, it would be convenient to
classify them into three categories. In the first
category fall Civil Appeals Nos. 172 to 184 of l £•58.
In 'the second category are two appeals, Civil
Appeals Nos. 185 and 186 of 1958. In the third
category falls Civil appeal No. 171 of 1938. The
appeals in the first two categories arise out of a
judgment in revision rendered by the High Court
of Punjab at Simla on August 26, 1954. That
decision was reported in British Jf edical Stores v.
L. Bhagirath Mal (1).
The appeal in the third category arises out of a short order of the said High
Court dated March 7, 1956, by which it dismissed an
application made by the appellant-tenant under
Art. 227 of the Constitution. It appears that the
order was based on the decision given by the Hit;h
Court in the first two categories of cases. The
11ppeals in the first two categories have been
brought to this Court on a certificate granted by
High Court, and have been consolidated by an
order made by the said Court. Civil Appeal No. 171
of 1958 has been brought t~ this Court in pursuance of special leave granted by this Court on
November 19, 1956.
The reason why these appeals h1wc beon pnt
in three categories is this. The judgment of the
High Court against which these appeals are really
directed is the judgment rcnden•cl in the first two
categories of cases (reported in Messrs.
British
Medical Stores v. L. Bhagfrath Mal (').
That judgment related to four sets of buildings of Chandni
Chowk in Delhi. In Civil Apprals Nos. 17:! to l g6,
we are roncerned with two of thest' buildings ownrd
by the landlord Bhagirath Mal, who has since died
(I) (1955\ I. L. R. 8 Punjab 639.
1961
Ro.1/ian Lal
Meltra
v.
lshu:ar Das
S.K. Du. .T.
1961
Roshan Lal
Mihra
v.
lshicar Das
8. K. Das J.
950
SUPREME COURT REPORTS
[1962]
and is now represented by some of the respondents.
For convenience, however, we shall refer to him
as the landlord. The two buildings we are concerned with are called (1) "Chemists' Market",
also known as "Medicine Market", and (2) "Prem
Building". Both these buildings are part of a
colony called "Bhagirath Colony". Several tenants
took on rent flats or rooms in the said buildings
and the question which foll for determination was
the fair and standard rent payable for the said flats
or rooms und!'f s. 7A of the Delhi and AjmerMarwara Rent Control Act, 1947, (Act XIX of 1947),
hereinafter referred to as the Control Act, 1947.
In the first two categories of appeals, the main
point for consideration before us is whether the
judgment rendered by the High Court on August 26,
1954, was correct, ,the High Court having held that
the whole proceedings .taken bPfore
the Rent
Controller were ·ultra vires and without jurisdiction.
The reasons given for this finding by the High Court
were not quite the same in respect of the two buildings; somewhat different reasons were given in
the cases of the two tenants in the Prem Building.
Theroforn, it would be convenient to deal
with the main judgment of the High Court in· Civil
Appeals Nos. 172 to 18-i of 1958 of the tenants in
the building known as "Chemists' Market". We shall
then <lea! with the special considerations arising
in the two appeals preferred by the t<mants of the
"Prem Building". Lastly, we shall deal with Civil
Appeal No. 171 of 1958 which relates to a diffierent
building altogether belonging to a different proprietor, namely two ground-floor flats of a house
on plot No 20, Block No. 13 in ·western Extension
Area, Karollmgh, New Delhi. We shall later state
the facts of that appeal, but it is sufficient to state
here that thtJ application for fixation of standard
rent for the flats in the Karolbagh house was dismissed on the ground that the High Court had held
earlier in the first two cakgories of cHses, that.a. 7A
of the Control Act, 1947 was unconstitutional and
I
. -
•
2 S.C.R.
SUPREME COURT REPORTS
951
void after the coming into force of tlie Constitution
of India on January 26, 1950.
Civil Appeals Nos. l 72 to 184 of 1958
Having made these preliminary remarks with
regard to the classification of the appeals, we pro.
ceed now to state the facts with regard to the first
category of appeals relating to the "Chemists'
Market" in Bhagirath Colony. On July 30, 1948,
nine tenants made an application to the Rent Controller, Delhi, asking for a determination of fair
and standard rent of the tenements (shops) rented
to them by the landlord, on the ground that under
the stress of circumstances which resulted from
the partition
of the country and scarcity of
business
premises . a vaila blc
in
Delhi
after
partition, they were forced to take on rent the shops
in question on an excessive and
exorbitant
rate
of rent charged by the landlord. They
allegecl that the premises were completed after
March 24, 1947, and they were entitled to han• the
fair and standard rent determined for the shops in
question by the rent Controller. On August 12,
1948, the Rent Controller recorded an order to the
effect that in order to fix the rent of the shops in
question in accordance with s. 7 A rMd with
Sch. IV of the Control Act, 1947 a summary enquiry
would be held on August 18, 1948. A notice was
issued to that effect to the landlord, directing him
to attend and bring all relevant authenticated
records such as plans, account books, vouchers etc.,
showing the cost of construction of the building; the
landlorcl was also asked to bring
documentary
evidence relating to the date of completion of
construction of the building. It is necessary to
explain here why t.he datt of completion of construction of the building was important. The
Control Act, 1947 eame into force •Jn March 24,
194 7.
By s. 1 ( 2) thereof, as it originally stood, it
was not applicable to any premises the construction
1961
Roskan Lal
Mehra
v.
Ishwar Da8
S. K. DasJ.
1961
Roshan Lal
Mehra
v.
lshwar Das
8. K, DasJ.
952
SUPRE\TE COURT REPORTS
[1962]
of which was not completed by March 24, 1947,
and which was not let to a tenant before the enforcement of the Act. Later, there was an Ordinance
(Ordinaecc No. XVIII of 1947) followed by an Act
(Act L of 1947)by which enactment newly 'constructed buildings were br011ght within the purview
of the Control Act, 1947 by repealing s. 1(2) of the
Act in so far as it affected buildings in Delhi and
by introducing s,7 A and Sch. IV to the Act. We
shall presently read s. 7 A and the relevant provisions of Sch. IV. We may just state here that s. 7 A
laid down that the fair rent of newly constructed
buildings shall be fixed according to the provisions
set forth in Sch. IV. Buildings which were completed earlier than March 24, 1947, had tu be dealt
with bv the Civil Court under s.7 of the Act.
Under · s.7 A
read with Sch. IV,
the Rent
Controller had jurisdiction to fix the fair and
standard rent in respect of buildings which were not
completed before the commencement of the Act.
Therefore, the Rent Controller had to determine
the date of completion of the buildiiig, in order to
have jurisdiction under s. 7 A of the Control Act,
1947.
We have referred to the notice which the
Rent Controller had directed to be issued to the
landlord on August 12, 1948; fixing August 18,
1948, as the date for the hearing of the case. On
August 18, the landlord made an application by
means of a letter sent to the Rent Controller in
which he asked fdr postponement of the case to
some date ia September. The c~se was postponed
to August 26, 1948, but on that elate the landlord
again asked for
an adjournment.
Then on
September 1, 1948, an applicat!on was made on
behalf of the landlord, in which there was a
reference to 14 tenants who had applied for
fixation of standard rent for the
~hops in the
Chemists' Market. In this application the landlord
stated that he himself had applied for fixation of
I
2 S.C.R.
SUPREME COURT REPORTS
953
standard rent under s. 7 of the Control Act, 1947
in the Court of the Subordinate Judge, Delhi and
as those applications were pending, he prayed that
the proceedings for determining the Identical q uestion of fixation of standard rent by the Rent
Controller under s.7A
should be stayed. The
printed record does not clearly.show how and when
tenants other than the 9 tenants who had originally applied for fixation of standard rent on July
30, 1948, had also applied for fixation of standard
rent for the shops in their occupation. It is clear,
however, from the application of the landlord
dated September 1, 1948 that 14 tenants including
some of those who had applied on .July 30, 1948
had applied for fixation of standard rent for the
shops ocmpied by them. On November 9, 1948,
the Rent Controller wrote a letter to the landlord
in which he reforrcd to some enquiry held in his
officP on September 1, 1949 and said:
"On that day you promised to prnduce sorue
papers
to
show
that these
shops were
completed before
March 24,
194 7.
As the case is unnecessarily being
delayed, you are requested to appear in my
office with all the necessary documents
at 3 P.M. on WTednegday the 17th November,
1948. It may please be noted that no further
adjournment will be possible. Your failing to
comply with this notice, ex-parte decision will
be given"
On November 15, 1948 the Rent' Controller again
wrote to the landlord that on a representation made
by the landlord's representative, the date had been
extended to November 19, 1948 and the landlord
should produce all necessary documents relating to
the building in question. The Rent Controller again
reminded the landlord that there would be a final
hearing on November 19. On that date, however,
the landlord.again made an application saying that
&s there were regular suits for the determination
1961
Roshan Lal
Mehra
v.
lshwar Das
S. K. Das .J.
1961
R0&1 .. in Lal
Mehra
v.
l•hll!ar Das
S. K. Das J.
954
SUPREME COURT REPORTS
[Hl62]
of the standard rent pending in the Court of
the Subordinate Judge, Delhi, the proceedings
before the Rent Controller shoula be stayed. On
November 26, 1948 the Rent Controller wrote to
the landlord to the following effect:
"As you have failed to attend my office
personally on the fixed date and your attorney did not possess any information or documents
regarding
the newly
constructed
"Chemists' Market", you are now directed to
submit your written statement on oath, duly
countersigned by your advocate, giving full
details regarding the date of constru(Jtion of
the said building. Please note that your statement must reach this· office before the 3rd
December 1948".
Then 011 December 3, Hl48 the Rent Controller
wrote to the landlord saying that he would be visittng thf' promises on Deeember 5, 1948. On December 3, a t-0legram was sent on behalf of the landlord
savin" that he was out of station. On that date
'
r
the RPnt. Controller recorded the following order:
"These Rhops were first l"'t out from 1st
April, 1948.
Note.-The Advocate for the landlord
was requested to tell the landlord that he
must submit his statement in writing (counter-
~igned by the AdFicate) within the next 15 days
whether he contends or does not contend that
this building was completed after 24th March,
1947.
The Advocate for the landlord gave an
application asking for staying the proceedings
as he had applied h1 the Sub-Judge for fixation of standard rent of the premises. He was
told that I was not prepared to stay the proceedings unless he or his dient. were prepared
to say on oath that the lmilding was completed before the 24th March, 194 7."
•
I
\
2 s.c.R.
SUPREME COURT REPORTS
955
On December 9, 1948 the Rent Controller again
wrote to the landlord to the following effect:
" I am in receipt of your telegram dated
the 3rd December, 1948.
On 19th November, 1948, the last date of
1961
Roshan T>d
Mehra
V,
IBhwar Da.
hearing, your Advocate Shri Jugal Kishorc
.~. K. Da,,; J.
and your General Attorney Shri Kunchl Lal
were given definite instruction to see that your
written statement, as to when the constrnotion of the "Chemists' Market'' was started
and when completed, was sent to me within
15 days. These instructions were later confirmed in writing vide this office No. R. C.
'!2/ Camp. dated the 26th November, Hl48. My
instructions, however, have not been complied
with so far and it is presumed that you are
trying to evade thtJ issue.
I, however, give you another final opportunity and direct you to submit your written
statement on oath within one week from the
receipt. hereof, showing the date of completion
of construction of yuur building known as
"Chemists' Market" in Bhagirath Colony,
Chandni Chowk, Delhi.
Please take notice that your failure to
comply with (torn) within the stipulated
period will amount to disobeying the orders
of this Court and the case will be rcfcned to
appropriate authorities for necessary action in
the matter."
The landlord took no steps whatsoever to furnish
any written statement. In these circumstances,
the .Rent Controller passed his final order on
January IO, 1949. In that order he recited the
.facts stated above and ended up by saying that
though the hndlurd had been given sufficient opportunity, he had not mwle any statement in writing or
1961
Roshan Lal
Mehra
v.
lshwar Das
8. K. Das J.
!l5(i
SlJPREllfE coer.T IlEPORTS
[196.?J
othf'rwise and tlmt th(· landlord was rlearly trying
to avc'id the trial of the j_,,,me.
Thr Rent Controller had inspected the building on December 12, 1948
and made local enquiries. He came to the finding
that the shops in question were completed (!Illy in
the beginning of 1948. He said :
"I inspected this building on 12th December, l 048 and made local enquiries when it
transpired that the building (shops) was completed only in the beginning of l\J48,
The
very look of the building also confirms this
information. On the othe1 hand, no da.ta has
been placed before me by the landlord, his
attomev ur the advocate to show that the
cmrntruction of the building was completed
before :!+th M:arch, l\J47. According to the
admitted statement of the attorney the 8hopH
h·we been let out for the first time in l !J-l8 and
otherwise too his sbitement of l!Jth November, l!J48 shows that the building had not
been completed Lefore Uth Mareh, 1!)47. No
completion ecrtificatc or house-tax n>ceipts
have Leen produced in support of this contention. It is,
therefore, nut undernt;mdable
how it is claimed that the shops were completed before 24th March, 1947. The owner is
knowingly avoiding to give a statement himself that the shops were completed before
24th M:arch, 194 7.
Evidently because he
realises that this is not trne. It has also not
Leen statecl what use was ma.de of these shops
till January, l\l48, when they were firnt let
out if they hnd been completed before :!Jth
.March, l D-17 as alleged.
It is unbelievable that ehops like thesn
<·ould rrnnain unoccupied for nearly H to 1.0
months ttftcr completion. I am, thi.·n·furn,
convinced beyond a shadow of duubt that
the construetion of these shops was completed
long after :l4th March, 1947, and the fixation
-
,;,.
...
·I
)
'
2 S:C.R.
;::>UPRF:c\IJ~ COURT REPORTS
\157
of their standanl rent definitely falls within
the scopo of s. 7 A of
the·
Delhi and
Ajmer-.Harwara Rent Contrnl Aet, 194 7 (as
amemled). I, therefore, proceed to fix the
rent accordingly."
After taking into consideration the nature of the
construetiou and the fittings, pte., and other re levant consideratiom, the Rent Controller fixed the
valuation at Rs. 9-7-0 per sq. ft. of plinth area for
working out the probable co~t of the constrnction
of the building.
The cost of the land, he estimated
at Rs. 275 per sq. yd.; but he allowed only one-third
of the estin1atc inaEmuch as the b1iilding was onestoreyct! and alJ the buikli11gH in the vicinity were
mostly three-stornyed. On these calculations, he
held that the standard rent for a11 tho shops in the
building worked. out at Rs. ;J31i per month incll!(Iing
I 0% for rcpairn but t•xdmling hou,<·-tax am! dwrges
for consumption of irater aud eledri<'.'.ity.
A ealculation sheet was prepa!'ed fixing the st<tndanl reut
for each of the shops including some shops whfoh
were vacant, Oil the aforesaid
ba~is. The calculation sheet showed that the standard rent of 18
shops in the building varied from Rs. 10 per month
to Rs. i)O per month.
Against the order of the Rent Controller dated
January 10, 194[!, nineteen appeals were taken to
the District Judgf'. One of the points taken before
the District Judge was that the Rent ControlJer had
no jurisdiction to fix the standard rent inasmueh
as the building had been completed before Mareh 2-!,
1947. The learned District Judge dealt with this
poiut at length, and held that the Reut Controller's
finding on the question of jmisdiction was correct.
As to fair rent, he . held that though the building
was smglc-storeyed, there was no reason why tho
larnUonl slwuld not be allowed the full value of the
land on whid1 the building stood. Allowing foll
value for the land and having regard to the rent
of prt>mises in the neighbouriug ai·ea, the learned
1961
Roshan Lal
Mehra
'Ii.
Ishu·ar Das
8. K. ])as .f.
j[l(j]
Roshan Lal
Mehra
v.
lshwar Das
fl. K. Das J,
fl58
SUPREME COUHT REPORTS
[1962]
DiHtri('t .Judge modified the order of tlw Rent
Cuntmll1'1' and fixetl the 'tamlanl rent of the
buildiug at Its. ii/O per month, viz., double of what
was fixe<l by the Rent Controller.
The learned
District Judge passed his order on January 15,
19!\l.
It appears that from the order of the District
Judge, Delhi dated .January 15, 1951, certain applications in revision were made to the Punjab High
Court. Most of the applications were by the landlord, but one of them was by a tenant. These applications were heard together by the High Court. The
High Court allowed the application8 of the landlord
and held in effect that the proceedings before the
!tent Controller violated the principles of natt1ral
justice and were, therefore, bad and without jurisdietion.
The High Court, it appears, trav-elled over
a wide field and dealt with a number of quc8tio1rn,
though its decision was based on the finding stated
above.
The first question which the High Court
considered was whether s.7A read with Sch. IV of
the ·control Act, 194'7 prescribed a discriminatory
procedure without a
reasonable classification in
respeet of premises completed after March 24, 1947
and thus violated the guarantee of equaj protection
under Art. 14 of the Constitution. Along with this
question was canvassed another connected question
viz., whether these cases would be governed by the
law in force at the time of the decision given by
the Rent Controller or by the law existing at the
time when the District Judge heard the appeals. It
may he here noted that the Constitution of India
came into force on Jannarv 26, 1950 and at the
date of decision of the Rent" Controller, Art. 14 of
the Constitution was not in force.
The High Court
expresHed the view that the law to be applied wae
the law in existem:e at. thP time wh<·n th<' District
,Judge decided the appeals. It further held that
s. 7 A rca.d with Sch. IV of the Control Act, 194 7
waa violative of the guarantee of equal protection
'
2S.C.R.
SUPREME COURT REPORTS
959
of laws under Art. H of the Constitution, there
beimr no rational nexus between the classification
mad~ regarding premises old and new . and the
objects of thP statute. Having given these two
findings, the High Court said, however, that it
would prefor not to base its judgment on these
findings, hec:ause to do so might be giving retrospective offed Lo the Constitution. The High Court
then wenl on to consider the further contention
urged before it that in the proceedings before the
Rent Controller there \las a violation of the principles of natural justice inasmuch as all recognised
principles governing tribunals whicli
exercise
quasi-judicial po\vern or follow a procedure subserving the orderly administration of justice had been
disregarded. On this point the lE'arned Judge,
delivering the judgment of the Court, expressed
himself as follows :
"In the present case no evid0 nce as to
rent was called from the parties or recorded
by the Controller nor was any opportunity
afforded to the parties to adduce such or any
evidence which they considered necessary to
submit. The Contrc:fllcr made private enquiries and his order shows that he has based
his decision on the cost of the buildino- which
"
he himself calculated without aEmling the
petitioner an opportunity to show that such
calculation was wrong or its basis erroneous.
Of course, there is no procedure prescribed by
the Schedule and whatever procedure was
followed docs not subserve the orderly administration of justice. So that the determination
is based on private enquiries, unchecked calculations and no evidence of the parties who
were afforded no opportunity of proving their'
respective cases."
\Vith regard to the flats in 'Prem Building' a farther
ground givPn by the High Court was that they were
1961
Roshan Lal
lvfehra
v.
lehwar Da8
8. K. Das J,
l9ttl
Roshan Lal
Mehra
v.
ltJhu:ar Das
S. I\. Du, . ./.
'
960
SUPREME COURT REPORTS
[1962]
not now con"truction as held by the District Judge,
and therefore s.7A was not applicable for cleter·
rliim•tion of fair and stanclard rent in respect
thereof.
We 111ay first Llisposc of the constitutional
point that s.7A read with 8oh. IV of· thu Control
Act, 1~47 violated the funclamental right guaranteed under Art.. 14 of the Constitution. Wo may
here read s.7A mnl some of the provisions of
t:lch. IV.
"7 A.
The r1rovisions set.
OU t
in the
Fourth Schedule shall apply to the fixation of
rent and other matters re la ting to the premises in Delhi (hereinafter referred to as tho
newly constructed premises) the eonst.t-uction
of which was not' completed before t-lw commencement of this Act-.
The Fourth Schedule
1.
"Rent Controller" for the purposes
_of this Sc,heclule means the person appointed
oy the Central Government as the Rent
Controlle)".
2. If the Rent Controller on a written
complaint or otherwise has reason to believe
that thEI rent of any newly constructed premises is excessive, he may, afwr makiug such
inquiry as he thinks fit, proceed to fix the
standarcl rent thereof.
·
3.
The Rent Controller in fixing the
standard rent shall state in writing his reasons
therefor.
J. In fixing tho 8t1imlanl rent the Rent
C011Lrolkr 8hall lake into etrnHideralion itll
circuurnta11<:c8 of tho
<"a0<'
includiug any
amount paid •Jr to lie paid by t.hc teuant by
way of premium or any other like_ sum in
addition to rent.
.,
'
2 S:C.R. SUPREME COURT REPORTS
961
5 and 6.
x
x
x
x
x
7.
For the purposes of an inquiry under
paragraphs 2, 5 and 6, the Rent Controller
may-
( a) require the landlord to produce any
book of account, document or other information relating to the newly constructed
premises,
(b) enter and inspect such premises after
due notice, and
(c) authorise any officer subordinate to
him to enter and inspect such premises after
due notice.
8 to 10. x
x
x
x
x
11. Any per8on aggrieved by an order
of the Ront Controller may, within thirty
days from the date on which the order is
communicated to him, appeal to the District
Judge, Delhi."
This very question was considered by a Full
Bench of the same High Court in a later decision
(see G: D. Soni v. S. N. Bhalla('). In that deci·
sion the High Court went into t.he entire history
of legisla,tion with regard to the control of house
rent in both old Delhi and New Delhi from 1939
onwards when the second world war broke out.
The High Court pointed out that the New Delhi
House Rent Control Order, 1939 made under r. 81
of the Defence of Tndia Rules was the first Control
Order seeking to control' rent of houses in New Delhi
and the Civil Lines. From 1939 till 1942 no Rent
Control Act applied to the municipal area of Delhi.
On October 16, 1942 the Punjab Urban Hent
Restrietion
Act, 1941
with
suitable
adaptations
was extended
to
that area. Under
that
Act a
landlord
could
recover
only
standard rent from the tenant and the term
'standard rent' was defined as meaning the rent nt
(I) A l.R. 1959 Punj. 381.
1961
Roshan Lal
Mehra
v.
ls/,war Das
S. K. DasJ;
1961
I ~o.~ha ·1. J.,al
Jfehm
v.
962
SUPREME COURT REPORTS
[l962j
which the premises wcru let on January 1, 1939
;md if not so, the rent at which they were last let.
In cases not governed entirely by this definition,
the Court was given the power to fix standard rent.
In l!J44 the then GoYcrnor·General promulgated
the Delhi Rent Control Ordinance, 1944. Under
this Ordinance the Chief Commissioner could apply
it to any area within the Province of Delhi and
whenever the Ordinance was made applicable
to any area, the .Punjab Urban Rent Restriction
Act, 194 l 0cased to be opcrntivc.
In the Ordinance
also standard rent was defined substantially in the
samp terms as in the Punjab Act. The Central
legisfature then enacted the Control Act,
194 7
which repealed the Punjab Act as extended to Delhi
and also the Rent Control Order of 1939 and the
1944 Ordinance.
By 'S.1(2) the Act was made
inapplicable to any
premi;·es the eonstruction
of which
was not
complete1l by March
24,
l!l4 7 and· under s.7 of the Control Act, 194 7, a
Court in case uf tlispute had to detormine the
standard rent 011 the princilJles set forth in the
Second Schedule. We lHve already 8tated earlier
that s.l (2)
of the Control Act, 1947 was later
repealed (so far as it affected buildings in Delhi),
and newly constructed buildings were brought
withiu the purview of the Control Act, 1947 by
introduciug s. 7 A and 8<'hedulu IV tu it.
B'rom this brief smvcy of the legislative
history of the control of rent of premises situated in
the Province of Delhi, it is clear that the Control
Act, 194 7 brought about uniformity in the law relating to rent control by laying clown that the standard
rent of newly constructed premises shall be fixed by
the Reut Controlln while the Court will fix the
~t1twfarrl rout iu n1s1l('et of otlwr pn·mis(1s. There is
no d•.111bt that ;1 <'hH,;ifif'iltioJI was rnmlc between
premic;es th" corn;trw·I i• <ll '•I' wbid1 was ('O!Upleted
befon i\fareh 24, rn.17 aml th"'(' th" construction
of whi"11
was complnted after that date. The
question is whPthf'r thi~ rlassificmion is based on
2 S.C.R. SUPREME COURT REPORTS
963
intellig~ble differentia having a rational nexus with
the objects of the statute. Dealing with this question Bishan Narain, J. delivering the judgment of
of Full Bench said:
"The learned counsel for the landlord
challenged the validity of these provisions on
the grounds ( 1) that there is no reasonable
basis for fixing the standard rent of newly
constructed premises differently on a different
principle from the principle on which standarfl
rent is fixed for old buildings in the same
locality and (2) that there is no reason for
discriminating against the landlords of newly
.constructed buildings by laying down that
their standard rent shall be fixed by Rent
Controllers appointed by the Central Government while the standard rent of other
buildings is to be fixed by courts of law which
are bound to follow procedure laid down in
the Civil Procedure Code. It is urged that
the Rent Contro!Ier is not bound by any
procedure laid down by the Civil Procedure
Code or t.he Punjab Courts Act.
x
x
x
Section 7 says th \t the standard rent shall
be determined in accordance with the principles
set forth in the Second Schedule. The Second
Schedule fixes basic rent as determined under the
Control Order of 1939 or under the 1944 Ordinance
and in other cases the contractual rent mi 1-11-1939
or if not on that day then on the date first let
after 1-11-1939.
The standard rent thus fixed is to be increased by certain percentage speGified in the Schedule.
If the premises were let after 2-6-1944 then the
basic rent and the standard rent were to he the
same. Obviously this principle for fixation of
standard rent could not possibly have any appli-
~
cation to premises constructed and let
after
1961
Roshan Lal
Meltru
v.
lahwar Das
8. K. Da• J.
1961
Roshan Lal
Mehra
v.
I.hwar Das
S. K. DaaJ.
964
SUPREME COURT REPORTS
[1962)
24-3-.1947.
Section 7 then proceeds to lay down
th~~ if for any reason it is not possible to determm() the standard rent of any premises set forth
in tht' St>cond Schedule then the courts shall determine it having "regard to the standard rent of
similar premises in the same locality and other
relevant considerations". Para. 4 of Schedule IV
lays down:
'In fixing the standard rent the Rent Controller shall take into consideration all the circumstancrs of the ease including any amount paid or
to be paid by the tenant by way of premium or
any other like sum in addition to rent.'
It was argued on behalf of the landlord that
the criteria laid down in s. 7 ( 2) and para 4 of
Schedule IV of the Act is substantially different
and that there is no valid reason for such a differentiation.
He urged that the Rent Controller
( 1) may ignore the standard rent of similar premises
in t.he same locality while he is under an obligation
to take into consideration any amount paid or
agreed. to be paid by the tenant by way of premium
etc. in addition to rent and that the Rent Controller (2) cannot interfere with the agreed rent
unless he finds it excessive and in that case he can
only reduce the rent fixed between the parties and
cannot increase it. It is urged that under s. 7(2)
it is open to the Court to increase the standard
rent and also not to take into consideration any
amount
paid by the tenant as premium in
addition to rent.
Now the Rent Controller is enjoined by para
4 to take into consideration all the circumstances
of the case when fixing standard rent. It is not
understood how a Rent Controller can omit to
consider the standard rent of similar premises in
the same locality. This is obviously a relevant
consideration though para 4 does not specifically
mention it. It is true that this criteria has been
..
2 S.C.R.
SUPREME COURT REPORTS
965
specifically mentioned in s.7(2) of the Act and has
not been so mentioned in s. 7 A but this circumstance cannot lead to the inferenc'e that it is open
to the Rent Controller to ignore it.
The words of para 4 are in fact as wide in
effect as the words used in s.7(2) of the Act. In
this context it must not be forgotten that if such a
mistake is made by the Rent Controller then the
aggrieved party (may he be landlord or the tenant)
can appeal to the District Judge whose powers
are co-extensive with those of the Rent Controller
and who can set right any mistake made by
the Rent Controller. I am, therpfore, of the
opinion that the criterion laifl down for fixation of
standard rent in s.7(2) and para 4 is substantially
the same in scope and is not different.
x
x
x
x
x
x
Undoubtedly under Schedule IV the
Rent Controller can fix standard rent only if
he finds that the rent agreed upon between
the parties is excessive. This provision is to
protect the landlord from frivolous applications by tenants and it is not clear why a
landlord should object to this provision.
The reason for this provision is intelligible. It is well known that rents in Delhi
prior to 1-11-1939 ·were very low and in
some cases uneconomic.
Therefore the legislature decided that in such cases a landlord
~hould be in a position to get
standard
rent fixed at a rate higher than fixed by
agreement of the parties in 1939 or earlier.
No such consideration arises in the case of
buildings constructed or completed after
1947.
In 194 7 there existed an acute shortage
of accommodation in Delhi and the landlorrls
were in a position to dictate terms and, therefore, presumably the rents fixed between
the parties were not so low as to require increase. It is for this reason that it was
1961
Ro8ha11 La I
Mehra
v.
Ishwa.r Ila«
S. K. Das .J.
1961
Roskan Lal
Mehta
y,
Ishwar, ~
S-. K. DilB J.
- 966
SUPREME COURT REPORTS
[1962)
considered unnecessary to provide for increase,
of rent in Schedule IV. I am, therefore, of the
opinion that it
is not possible on
these
grounds to hold that s.7-A and Schedule IV
are unconstitutional.
The learned counsel then brought to
our notice two other matters in which the
newly constructed buildings have been treated differently from the old buildings. He
, pointed out that under para 10(2) of Sche·
dule IV the standard rent fixed by Rent
Controller must necessarily be retrospective
in effect while under s.7(5) the Court can
fix the date from which the payment of standard rent would become effective. He further pointed out that 'under s. 4(2) a landlord
on making improvements can increase the
standard rent by an amount not exceeding
6'! per cent of the cost of improvement
while under para 6 of the Schedule IV the
Rent Controller can increase the standard
rPnt in such circumstances to an amount
not exceeding 7-1/2 per cent of the cost of
improvement.
These are, however, no grounds for holding the impugned provisions to be unconstitutional. The Delhi and Ajmer-1\forwara Rent
Control Act, 1947,
came into
force on
24-3-194 7 originally for two years only and
s.7-A with Schedule IV were introduced in
September 1947.
Therefore
the standard
rent for new buildings could well be fixed from
the beginning of the lease. The old buildings
were let long before 194 7 and, therefore, it
was considered advisable to leave it to courts
to fix the date from which the payment of
standard-rent would become effective.
This is a rational difference. So is the
matter of difference of return on the cost of
•
2 S.C.R. SUPREME COURT REPORTS
967
improvements. There is no reason for equating the return on cost of improvements of old
buildings with the return on
the cost of
improvements of new buildings. This is a
matter for the legislature to consider and
this possible ,!'light difference in returns can·
not be said to be discriminatory and violative
of Article 14 of the Constitution .
For these reasons I am of the opinion
that the criteria for the fixation of standard
rent for new and old buildings is substantially
the same and does not violate Article 14
of the Constitution and there is no valid
readon for coming to the conclusion that the
standard rent of old and new buildings o.f the
same type and in the same locality would
necessarily be different. The first ground,
therefore, fails and rejected.
The second ground also has no force.
It is urged that in Schedule IV there is no
provision for recording the evidence of the
parties nor is it laid down whether th€ evidence is to be on oath. It is futher mged
that the principles of natural justice have
been disregarded by Schedule IV and it i'
open to the Rent Controller to fix standard
rent arbitrarily without recording any <.,vidence. Now para 2 Schedule IV SlJ.V8 that
,.
the Rent Controller shall make such 'enquiry
as he cunsiders fit to fix the standard rent.
x
x
x
[n fixing standard rent the Rent Controller decides a dispute between a landlord and
a tenant. To do this effectively he has to
take evidence and to hold a judicial inquiry
particularly when he has to give reasons for
his decision.
Para 7 is also
indicative of
such a judicial inquiry.
There is no reason
for
presuming
and assuming
that
the
1961
Roshan Lal
Melira.
v.
I sh.war Das
8. K. DasJ.
1961
Roshan Lal
Mehra
v.
l«liwar Da,<
8. K. Das J.
968
SUPREME COURT REPORTS
(1962]
Rent.Controller would not hold such an inquiry.
If he does not do so then the aggricved party
can always appeal to the District Judge,
Delhi who invariably iR a very senior and
experienced judi<,ial offi<'Pr.
x
x
x
x
x
In this context it must not be forgotten
that considering the recent rise in prices
of land, building material and labour costs
in Delhi the standard rent should be correlated to these costs.