# V ASU DEV SINGH AND ORS v. UNION OF INDIA AND ORS - **Citation:** [2006] Supp. 8 S.C.R. 535 - **Court:** Supreme Court of India - **Decided:** 2006-11-07 - **Case number:** Civil Appeal No. 4688 of2006 - **Bench:** S.B. Sinha, P.P. Naolekar - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/v-asu-dev-singh-and-ors-v-union-of-india-and-ors-21933 - **Pages:** 61 ## Headnote B East Punjab Urban Rent Restriction Act, 1949-Section 3-Notification under, by Administrator-Directing that provisions of Act not applicable to buildings and rented land whose monthly rental exceeded Rs. 1500-Validity C of-Held: Delegation of essential legislative function is impermissibleAdministrator has no jurisdiction to issue a Notification which would have a permanent impact-It cannot change the basic features of the law or act contrary to the legislative policy-It could exercise power under section 3 only in terms of legislative policy-Administrator cannot repeal provisions of the main Act-Change of legislative policy with the aid of the National f> Housing Policy was not within the domain of the Administrator-It was the sole prerogative of the legislature-Thus, Notification violative of legislative policy-East Punjab Urban Rent Restriction (Extension to Chandigarh) Act, 1974-Constitution of India, 1950-Artic/es 245 and 246. Administrative law: Conditional legislation and delegated legislation-Distinction · between-Explained Delegated legislation-Judicial review, scope of-Held: Is permissible E though the scope is limited. F Legislation: Legislative policy-Ascertainment of-Held: Can be gathered fi·om the preamble of a statute, statement of object and reasons and the provisions therein. Prior to coming into force of Punjab Re-organisation Act, 1966, Union G Territory of Chandigarh was part of State of Punjab. East Punjab Urban Rent Restriction Act, 1949 was enacted to restrict the increase of rent of certain premises situated within the limits of urban areas and eviction of tenants therefrom. Provisions of 1949 Act were extended to Union Territory of 535 H 536 SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R. I A Chandigarh by Notification. Appellants-tenants in the premises within Union Territory of Chandigarh were protected in terms of 1949 Act. High Court struck down the Notification since Chandigarh was not declared an urban area. In 1972, Chandigarh was declared an urban area. Thereafter, East Punjab Urban Rent Restriction (Extension to Chandigarh) Act, 1974 was enacted in terms whereof provisions of 1949 Act were extended to Union Territory of B Chandigarh. The Administrator of Chandigarh in exercise of his power conferred upon him under section 3 of 1949 Act, issued Notification dated 07.11.2002 directing that the provisions of the Act would not apply to the buildings and rented land whose monthly rental exceeded Rs. 1500/-. Appellant filed writ petition challenging the vires of Section 3 of 1949 as also vali~ity C of the Notification. Administrator filed additional affidavit before the High Court assigning reasons for issuing the said notification. Reference was made to the National Housing Policy adopted by the Central Government, Model Rent Law suggested by Government of India as also various correspondences entered into by and between Central Government and the Union Territory D culminating in issuance of the said Notification. High Court dismissed the writ petitions holding that the Notification was not ultra vires the provisions of the 1949 Act. Hence the present appeals. Allowing the appeals, the Court HELD: 1. The order of High Court that the Notification dated 07.11.2002 E issued by Administrator of Chandigarh in exercise of his power conferred upon him under section 3 of the East Punjab Urban Rent Restriction Act, 1949 directing that the provisions of the Act would not apply to the buildings and rented land whose monthly rental exceeded Rs.1500/-, was not ultravires the provisions of the 1949 Act, cannot be sustained. (546-E-FJ F 2.1. The distinction between conditional legislation and delegated legislation is clear and unambiguous. In a conditional legislation the delegatee has to apply the law to an area or to determine the time and manner of carrying it into effect or at such time, as it decides or to understand the rule of legislation, it would be a conditional legislation. The legislature in such a G ca ## Text _Characters 0–39,230 of 148,162. This is a partial read: ask again with offset=39230 for what follows._ V ASU DEV SINGH AND ORS. A v. UNION OF INDIA AND ORS. NOVEMBER 7, 2006 [S.B. SINHA AND P.P. NAOLEKAR, JJ.] B East Punjab Urban Rent Restriction Act, 1949-Section 3-Notification under, by Administrator-Directing that provisions of Act not applicable to buildings and rented land whose monthly rental exceeded Rs. 1500-Validity C of-Held: Delegation of essential legislative function is impermissibleAdministrator has no jurisdiction to issue a Notification which would have a permanent impact-It cannot change the basic features of the law or act contrary to the legislative policy-It could exercise power under section 3 only in terms of legislative policy-Administrator cannot repeal provisions of the main Act-Change of legislative policy with the aid of the National f> Housing Policy was not within the domain of the Administrator-It was the sole prerogative of the legislature-Thus, Notification violative of legislative policy-East Punjab Urban Rent Restriction (Extension to Chandigarh) Act, 1974-Constitution of India, 1950-Artic/es 245 and 246. Administrative law: Conditional legislation and delegated legislation-Distinction · between-Explained Delegated legislation-Judicial review, scope of-Held: Is permissible E though the scope is limited. F Legislation: Legislative policy-Ascertainment of-Held: Can be gathered fi·om the preamble of a statute, statement of object and reasons and the provisions therein. Prior to coming into force of Punjab Re-organisation Act, 1966, Union G Territory of Chandigarh was part of State of Punjab. East Punjab Urban Rent Restriction Act, 1949 was enacted to restrict the increase of rent of certain premises situated within the limits of urban areas and eviction of tenants therefrom. Provisions of 1949 Act were extended to Union Territory of 535 H 536 SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R. I A Chandigarh by Notification. Appellants-tenants in the premises within Union Territory of Chandigarh were protected in terms of 1949 Act. High Court struck down the Notification since Chandigarh was not declared an urban area. In 1972, Chandigarh was declared an urban area. Thereafter, East Punjab Urban Rent Restriction (Extension to Chandigarh) Act, 1974 was enacted in terms whereof provisions of 1949 Act were extended to Union Territory of B Chandigarh. The Administrator of Chandigarh in exercise of his power conferred upon him under section 3 of 1949 Act, issued Notification dated 07.11.2002 directing that the provisions of the Act would not apply to the buildings and rented land whose monthly rental exceeded Rs. 1500/-. Appellant filed writ petition challenging the vires of Section 3 of 1949 as also vali~ity C of the Notification. Administrator filed additional affidavit before the High Court assigning reasons for issuing the said notification. Reference was made to the National Housing Policy adopted by the Central Government, Model Rent Law suggested by Government of India as also various correspondences entered into by and between Central Government and the Union Territory D culminating in issuance of the said Notification. High Court dismissed the writ petitions holding that the Notification was not ultra vires the provisions of the 1949 Act. Hence the present appeals. Allowing the appeals, the Court HELD: 1. The order of High Court that the Notification dated 07.11.2002 E issued by Administrator of Chandigarh in exercise of his power conferred upon him under section 3 of the East Punjab Urban Rent Restriction Act, 1949 directing that the provisions of the Act would not apply to the buildings and rented land whose monthly rental exceeded Rs.1500/-, was not ultravires the provisions of the 1949 Act, cannot be sustained. (546-E-FJ F 2.1. The distinction between conditional legislation and delegated legislation is clear and unambiguous. In a conditional legislation the delegatee has to apply the law to an area or to determine the time and manner of carrying it into effect or at such time, as it decides or to understand the rule of legislation, it would be a conditional legislation. The legislature in such a G case makes the law, which is complete in all respects but the same is not brought into operation immediately. The enforcement of the law would depend upon the fulfilment of a condition and what is delegated to the executive is the authority to determine by exercising its own judgment as to whether such conditions have been fulfilled and/or the time has come when such legislation H should be brought in force. Therefore, the taking effect of a legislation, is VASUDEVSINGHv. U.0.1. 537 made dependent upon the determination of such fact or condition by the A executive organ of the Government. Delegated legislation, however, involves delegation of rule making power of legislation and authorises an executive authority to bring in force such an area by reason thereof. The discretion conferred on the executive by way of delegated legislation is much wider. Such power to make rules or regulations, however, must be exercised within the four corners of the Act. Thus, delegated legislation is a device which has been .J3 fashioned by the legislature to be exercised in the manner laid down in the legislation itself. (553-B-F] 2.2. It cannot be said that the impugned Notification is in effect and substance a conditional legislation and not a delegated legislation. By reason C of section 3 of the 1949 Act, Administrator, however, has been empowered to issue a notification whereby and whereunder, an exemption is granted for application of the Act itself. (553-F-G] Hamdard Dawakhana (Wakj) Lal Kuan, Delhi & Anr. v. Union of India & Ors., (1960) 2 SCR 671; MP. High Court Bar Association v. Union of India D & Ors., (2004) 11 SCC 766; State of Tamil Nadu, represented by Secretary, Housing Deptt., Madras v. K. Sabanayagam & Anr., [1998] 1 SCC 318 and Orient Paper and Industries Ltd & Anr. v. State of Orissa & Ors., (1991) Supp. 1 sec 81, relied on. 3. While considering the validity of dele~ated legislation, the scope of E judicial review is limited but the scope and effect thereof have to be considered having regard to the nature and object thereof. The nature of delegated legislation can be broadly classified as the rule-making power; and grant of exemption from the operation of a statute. In the latter category, the scope of judicial review would be wider as the statutory authority while exercising its F statutory power must show that the same had not only been done within the four corners thereof but otherwise fulfills the criteria laid down therefor. Therefore, the law which is laid down is that if by a Notification, the Act itself stands effaced; the Notification may be struck down. But that may not be the only factor. [554-E-G; 557-A-B] P.J. Irani v. State of Madras and Anr., (1962) 2 SCR 169, relied on. Clariant International ltd. and Anr. v. Securities & Exchange Board of India, (2004) 8 SCC 524; State of Rajasthan and Ors. v. Basant Nahata, (2005) 12 sec 77: AIR (2005) SC 3401; B.K. Industries and Ors. v. Union of India and Ors., [1993) Supp. 3 sec 621; Hindustan lever and Ors. v. ·H. 538 SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R. A Hindustan Lever Mazdoor Sabha and Ors., [1994] Supp. 1 SCC l; Nedurimilli Janardhana Reddy v. Progressive Democratic Student Union and Ors., [1994] 6 SCC 506; Agricultural Market Committee v. Shalimar Chemical Works Ltd, [1997] 5 SCC 516; Additional District Magistrate (Rev.) Delhi Admn. etc. v. Siri Ram etc., [2000] 5 SCC 451; ITW Signode India Ltd v. Collector of Central Excise, (2004] 3 SCC 48; Secretary, Ministry of Chemicals and B Fertilizers, Government of India v. Cipla Ltd and Ors., [2003) 7 SCC l; Maharashtra State Board of Secondary and Higher Secondary Education and Anr. etc. v. Paritosh Bhupeshkumar Sheth and Ors., [1984) 4 SCC 27; Indian Express Newspapers (Bombay) Pvt. Ltd and Ors. etc. v. Union of India and Ors. etc., (1985] 1 SCC 641; Khoday Distilleries Ltd and Ors. v. State of C Karnataka and Ors., [1996) 10 SCC 304; Dai-ichi Karkaria Ltd v. Union of India and Ors., [2000) 4 SCC 57 and Bombay Dyeing and Mfg. Co. Ltd (3) v. Bombay Environmental Action Group and Ors., [2006] 3 SCC 434; Kera/a Samsthana Chetu Thozhilali Union v. State of Kera/a and Ors., (2006[ 4 SCC 327, referred to. D Principles of Statutory Interpretation by G.P. Singh, Tenth Edition p 916 E and Craies on Statute Law, 7th Edition, referred to. 4.1. The legal history can be taken into consideration for construction of a statute. Chandigarh, admittedly, is a new town. It was meant to be used as a Union Territory in terms of the provisions of the Punjab Resettlement Act. It enjoys a unique feature which no other town in India does, namely, capital of two States as also being an Union Territory in itself. Although it is a capital of two States, the essential functions of a legislative authority as also power of administrations are in the hands of the Central Government in terms of Article 239 of the Constitution oflndia. It is the Parliament alone which would F legislate on its behalf. The Central Government extended the beneficial legislation of rent control in the Union Territory. [581-A-C) Dr. Harkishan Singh v. Union of India and Ors., AIR (1975) P&H 160: (1975) PLR 163, referred to. . . 4.2. The 1949 Act was conceived as a measure to overcome shortage of G rental accommodation in the wake of Second World War and the influx of refugees following partition. The Union of India also accepts that the object of the State Act to provide for control and regulation of the rental housing market, determination of fair rent, protection of tenants against indiscriminate eviction at the hands of landlords and the rights of the landlords for recovery H of tenanted premises in specific cases. (589-B-D) V ASU DEV SINGH v. U.O.I. 539 4.3. The reasons for which the impugned notification was issued was A stated to be that the social objective of the Rent Control Act had not been realised and it had various other adverse effects including simulation of investment in rental housing especially from the lower and middle income groups. A model Rent Control legislation was circulated in the year 1992 wherein proposal was made to give exemption to residential non-residential premises carrying more than specified rental of Rs. 1500/- per month. The Government of India had been advocating urban section reforms and had introduced an urban reforms incentive scheme whereunder funds are to be provided by it and to urban sector reforms such reform was to be carried out B, for removing the rental laws. Therefore, wnat was contemplated, was amendment of the existing legislation by the legislature so as to achieve partial C repeal of the Act. The National Housing Policy or the Central Government did not and could not recommend that what can be done only by the legislature, can be achieved through the route of Notification issued by the Administration under section 3 of the Act. 1589-D-H; 590-AJ 4.4. The legislature itself, provided for speedy relief to a section of D landlords. The provisions have been enacted for the purpose of protection of tenants of certain sections. (588-H, 589-A) 4.5. The words "certain premises", for the purpose of ascertaining the legislative policy must be construed having regard to the definition of E "building" only. The words "certain premises", having regard to their applicability in the urban areas, would also mean that the premises situated in the urban area and not in rural area. 1589-A-B] 5.1. Legislative Policy of a State can be gathered from the Preamble of the Statute, the Statement of Objects and Reasons and the core provisions F contained therein. In construing.a statute, preamble may not have a role to play unless the meaning thereof is obscure or if plain meaning is to be given, the same would lead to an absurdity, but, the preamble being a part of the statute can be read along with other portions of the Act to give clear meaning to the provisions and to decide whether they are clear or ambiguous, the G preamble in itself is not an enacting provision as other relevant enacting words have to be found elsewhere in the Act, and the utility of the preamble diminishes if the statutory provisions are themselves capable of being given a literal meaning. Once, however the words used in statute have a plain meaning, the courts should not busy themselves to find out the supposed intention or the poliey underlying statute. 1582-H; 583-A-B-F-GJ H 540 SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R. A Union of India v. Elphinstone Spg. and Wvg. Co. Ltd. and Ors., [200 l) 4 SCC 139 and Sardar Gurmej Singh v. Sardar Partap Singh Kairon, [1960] 1 SCR 909, relied on. State of Rajasthan and Ors. v. Basant Nahata, (2005] 12 SCC 77: AIR (2005) SC 3401; Vasantlal Maganbhai Sanjanwala v. State of Bombay and B Ors., (1961) 1 SCR341 andLachmiNarainandOrs. v. Union of India& Ors., (1976) 2 sec 953, referred to. 5.2. The Rent Act was a beneficent legislation which sought to protect a category of the tenants occupying rented buildings specified therein not C _only from--eghancement of rent, but also from unreasonable eviction. Furthermore, the Act provides for protection of the tenants from unreasonable harassment at the hands of the landlords. (582-A-B] 5.3. Section 3 although is a part of the Act, but the same cannot be said to contain an in-built policy so as to empower the Administrator to do all such things which can be done by the legislature itself. By taking recourse to the D preamble, it cannot be said that the power to exclude the tenanted premises can be exercised without taking into consideration the legislative policy and the object of the Act. It may be true that by reason of Section 3 of the Act, no arbitrary power as such has been conferred in view of the fact that the Act applies only to certain classes of lands and buildings but the same would not E mean that the Administrator is free to take any action in any manner he likes. The action of the Administrator is indisputably subject to judicial review. [594-F-H; 595-A) 6.1. The executive government can exercise its power of exemption where such exemption had been granted only for a limited period; in respect of new F buildings, government buildings, buildings belonging to the local-self government and other public sector undertakings; areas belonging to the Cantonment Board which was outside the purview of the applicability of the original Act being governed by separate Act, like Cantonment Acts; where the same would come within the purview of the delegated legislation; where the tenants or tenanted premises form a distinct and separate class; where G having regard to the constitutional scheme that any State within the meaning of Article 12 of the Constitution would not treat its tenants in an unfair and arbitrary manner despite the rent control laws being not applicable in their case as they would be treated to be forming a separate class. (585-D-H] 6.2. The Administrator will have no jurisdiction to issue a notification _ H which would have a permanent impact. The Administrator cannot change the -I VASU DEV SINGH v. U.0.1. 541 basic features of the law or Act contrary to the legislative policy. A delegate A must act within the four corners of the Act, the guidelines wherefor must be provided for in the Act itself. The legislature, on the other hand, can not only repeal the statute, it can change the basic features of the law. The only limitation on the part of the legislature is that ordinarily it cannot take away a vested right. 1586-A-B) 6.3. With regard to the validity of the impugned Notification one of the grounds for invalidating the notification would be if irrelevant factors have been taken into consideration. Agother test which can be applied is as to whether the notification is otherwise ma/afide in the sense that the same has B, been used for unauthorised purpose. 1586-D-E] C P.J. Irani v. State of Madras and Anr., (1962) 2 SCR 169, relied on. 6.4. A statute can be amended, partially repealed or wholly repealed by the legislature only. The philosophy underlying a statute or the legislative policy, with the passage of time, may be altered but therefor only the legislature D has the requisite power and not the executive. The delegated legislation must be exercised within the parameters of essential legislative policy. The question must be considered from another angle. Delegation of essential legislative function is impermissible. It is essential for the legislature to declare its legislative policy which can be gathered from the express words used in the · statute or by necessary implication, having regard to the attending E circumstances. The legislature cannot delegate its power to repeal the law or modify its essential features. 1587-B-E] ().5. The Administrator is said to have taken into consideration the National Housing Policy circulated in the year 1992. Such a bahmcing procedure was recommended to be done by way of legislation and not by F executive action. The National Housing Policy recommended for step by step repeal of the Act and substituted the same by a new permanent Act By reason thereof the fact that most of the States had enacted temporary Acts which had been extended from time to time, was, thus, taken into consideration. Only because some exemption notifications had been issued under the Punjab Act G by itself may not be a ground to follow the same blindly inasmuch as the Punjab Act applies to the entire State. There may not be any town in the said State which may be as important as Chandigarh and where the rental of the tenanted premises would be as high as in the said town. The Administrator himself has described the status of Chandigarh. Despite the same, he equated H 542 SUPREME COURT REPORTS (2006] SUPP. 8 S.C.R. A Chandigarh with other towns ofthe State of Punjab. (586-E-H) 6.6. The Administrator in issuing the notification has missed the relevance of the distinction between the National Housing Policy and the legislative policy. The power of exemption could be exercised having regard to the legislative intent and policy whereas the National Housing Policy could B be given effect to by the legislature in modifying, varying or altogether doing away with the existing legislative policy and laying down a new policy therefor. Change of legislative policy with the aid of the National Housing Policy was not within the domain of the Administrator. It was the sole prerogaiive of the legislature. (587-A-B] c D 6.7. Section 3 of the Act is constitutionally valid. However, it provides for an enabling provision. The Central Government, by reason of the said provision, has been empowered to direct that all or any of the said provisions would not apply to any of the buildings or rented buildings or any class of buildings or any rented lands. (587-E-F] 6.8. The classification as regards the premises occupied and possessed by the State, the Local Self Government or other public sectors, however, stand on a different footing. It is now beyond any controversy that this Court treated the houses stated to be belonging to the State or public sector undertaking absolutely on a different footing on the pre-supposition that they would n.ot E unreasonably enhance the rental of the premises and they would conduct themselves in such a manner so as to make a tenant feel that they would not be subjected to unreasonable eviction. [590-E-F) Baburao Shantaram More v. Bombay Housing Board and Anr., ( 1954) SCR 572: AIR (1954) SC 153 and Mis. Dwarkadas Marfatia and Sons v. F Board of Trustees of the Port of Bombay, (1989) 3 SCC 293, referred to. Jamshed Hormusji Wadia v. Board of Trustees, Port of Mumbai and Anr., (2004) 3 SCC 214 and Municipal Corpn., Chandigarh and Ors. v. Shantikunj Investment (P) Ltd. and Ors., (2006) 4 SCC 109, relied on. G 6.9. Even the criterion underlying the policy is required to be changed H by way of modification or variation in the standard of rent, object whereof should have been achieved only by making suitable amendments in the Act itself. The Administrator could not have tinkered with the provisions of the Act. What should have been the criterion for fixing the quantum of rent so as to render the classification constitutional and valid in law although would not ·-. - V ASU DEV SINGH v. U.0.1. 543 ordinarily fall for consideration of the court, but the question as to whether A hy reason of fixation of such a rent which would render the Act inapplicable to a large section of the tenants would come within the scope of judicial review. The criterion which was required to be considered was not as to what rent a building could have fetched in 1978 but what would have been a fair criterion i,ts regards the quantum of rent when the notification was issued. For that B purpose, no data has been collected nor has any study been made. As to how the said criterion had been fixed is not known. Except stating that the rent of Rs. 1500/- to Rs. 3500/- was made the criterion in terms of the National Housing Policy, the Administrator did not assign any other reason. [591-H; 592-A-B-D-E] 6.10. The Administrator while issuing the impugned notification C misdirected himself in law insofar as he failed to take into consideration that he could not have exercised any jurisdiction in terms thereof as the National Housing Policy, inter alia, contains the guidelines for the State legislatures for enactment of law and the same was not meant to be taken recourse to by the Executive Government of the State. While exercising his jurisdiction under Section 3 of the Act, the Administrator was required to apply his own mind to the relevant facts. Application of mind on the part of the Administrator was D also necessary having regard to the rate of inflation and other factors including the prevalent rental in the neighbouring areas of the States of Punjab and Haryana. It was necessary to collect relevant data. Rental of Rs. 1500/- could not have