Mulakh Raj Mutneja and Another vs The State of Punjab and Others

Jawahar Lal Gupta, J.—On June 11, 1976, the State Government decided that the Class-I Municipal Committees should increase the rent at the rate of 20 per cent after every three years. These instructions were reiterated vide letter, dated July 21, 1986. The State Government also issued instructions regarding the charges to be recovered for regularisation of possession of sub-tenants. It directed that transfer of tenancy was to be authorised by charging ten times the annual rent. Aggrieved by these orders, certain tenants filed various petitions including Civil Writ, Petition No. 16890 of 1989 in this Court. vide order, dated July 20, 1993, the writ petitions were disposed of with a direction to the petitioners "to file a representation to the respective Municipal Committees within six weeks." It was further directed that "if the said representation is made, the concerned Municipal Committee will dispose of the same within six months thereafter by passing a speaking order in accordance with the rules/regulations."

In pursuance to the directions of this court, the Municipal Council, Abohar, considered the matter. It decided that there should be 5 per cent increase in rent after three years. It also decided to divide the shops into three categories and fix the rate of Rs. 2,500/-, Rs. 1,500/- and Rs. 1,000/-, respectively regarding the three categories of shops for effecting the change in tenancy. A copy of the Resolution passed by the Municipal Council, Abohar, has been produced as Annexure P8 with the writ petition.

The Deputy Director, Local Government, Ferozepore, vide his order, dated May 17,1994 asked for a detailed report. Thereafter on August 9, 1994, the operation of the Resolution was suspended u/s 232 of the Punjab Municipal Act, 1911. A copy of this order is at Annexure P-10 with the writ petition. The Municipal Council, through its President pointed out that the decision has been taken on account of the disturbed conditions in the State of Punjab and the fact that there has been a slump in the market. However vide order, dated October 23, 1994 the Director, Local Government Punjab, directed that the instructions issued by the State Government vide its letter, dated July 21, 1986 be got implemented in toto. It was further observed that in case the Municipal Council does not implement the above mentioned letter within one month, a proposal be sent to the Office for further necessary action.

Aggrieved by the orders of the State Government in directing the Municipal Council to implement the instructions issued vide letter, dated July 21, 1986, the President, Abohar Municipal Kirayadar Union and the Union have approached this Court through the present writ petition.

The instructions issued by the State Government and the order passed by the respondent-Authorities by which the Resolution of the Municipal Council was suspended/annulled have been impugned on various grounds.

Written statement has been filed by the Municipal Council. It has been stated by way of preliminary objections that the petitioners have no locus standi to file the writ petition. They are neither the tenants nor are they affected by the decisions. It has been further pointed out that the fixation of rent in respect of shops belonging to the Municipal Council is a matter of contract between the respondents and tenants. The dispute having arisen out of the contractual obligation, the writ petition is not maintainable. Furthermore, the petitioners have no cause for grievance against the order passed by the competent authority. If at all, it is the Municipal Council alone which can feel aggrieved as its Resolution has not been approved by the State Government.

On merits, the claim made by the petitioners has been controverted. It has been pointed out that instructions had been issued by the Government vide Circular, dated July 21, 1986, for ensuring that there was uniformity in the increase in rent throughout the State of Punjab. The action of the respondents in suspending or annulling the Resolution passed by the Municipal Committee was in strict conformity with the provisions of Section 232 of the Act. It has been further pointed out that in most of the cases the original tenants of the shops belonging to the Municipal Council had unauthorisedly transferred possession to ''strangers''. The respondent does not recognise these occupants and that they have no right to remain in possession of the shops. Transfer of lease can be permitted only in accordance with the decision of the Committee and the instructions issued by the Government. The submission that the action is without jurisdiction or is violative of the directions given by this Court has been controverted. The Municipal Council is an autonomous body but it has to operate under the supervisory control of the State Government. The claim made by the petitioners is wholly untenable in law and the writ petition deserves to be dismissed.

Mr. S.P. Jain, learned counsel for the petitioners has contended that respondents 3 and 4 had no jurisdiction to interfere with the Resolution passed by the Municipal Council and that the impugned orders did not conform to the requirement of a speaking order. The claim made on behalf of the petitioners was controverted by Mr. Viney Mittal, learned counsel for respondent No. 2 as well as Mr. S.S. Dhaliwal who appeared on behalf of the other respondents. It was specifically contended that the petitioners have no locus standi to file the present petition. The respondents further submitted that the order passed by the Respondents was in public interest. They also submitted that the fixation of rent was a purely contractual matter and as an owner the council had no right to fix the terms of tenancy and the rent.

The questions that arise for consideration are (i) Have the petitioners locus standi to file the present writ petition (ii) Is the action of the Government without jurisdiction? (iii) Are the impugned orders in conformity with the directions given by this Court in Civil Writ Petition No. 16890 of 1989, decided on July 20,1993 and (iv) Have the petitioners a just case which may warrant interference under Article 226 of the Constitution of India?

Re. (i)

Admittedly, the Municipal Council had passed a Resolution, dated March 4, 1994 regarding the increase in rent and the charges for transfer of tenancy. It decided that the rent should be increased at the rate of 5 percent after every three years and that the transfer of tenancy should be permitted at the rate of Rs. 2,500/-, Rs. 1,500/- and Rs. 1,000/- in respect of the three categories of shops. This Resolution of the Committee was not in conformity with the instructions issued by the Government vide its letter, dated July 21, 1986. Consequently, the operation of the Resolution was suspended by the Deputy Director vide his order, dated August 9, 1994, a copy of which has been produced as Annexure P-10 with the writ petition. Finally, the matter was decided by the Director, Local Government Punjab, vide order, dated October 23, 1994, who directed that the instructions issued by the State Government vide its letter dated July 21, 1986 be got implemented in toto.

The resolution passed by the Committee having been annulled by the State Government, the grievance, if any, was that of the Municipal Committee. So, far as the petitioners are concerned, they were not entitled to be either heard or given an opportunity by the Government. The law in this behalf was enunciated by a Division Bench of this Court in Karam Singh v. The State of Punjab (1979) 81 P.L.R. 426. It was held that u/s 236(2) the petitioners "was not entitled to any opportunity of being heard before the annulment or modification of the resolution of the Municipal Committee, Patiala, by the State Government." Then-Lordships had placed reliance on the rule laid down by the Supreme Court in Subhas Chandra and Others Vs. Municipal Corporation of Delhi and Another, and a Single Bench decision of this Court in Civil Writ Petition No. 2415 of 1968 (Khushwant Rai v. The State of Punjab, decided on February 21, 1969) and Baldev Raj Sharma v. The State of Punjab (1972) 74 P.L.R. 144. It is implicit in these decisions that only the Municipal Committee can make a grievance against an order of annulment of the Resolution. The persons affected by these decisions have no right to be heard. No doubt, their Lordships in Karam Singh''s case (supra), were considering the provisions of Section 236(2) but that is of no consequence. The position in respect of an order u/s 232 is identical.

It also deserves notice that the petitioners in the present case are neither the tenants nor the sub-tenants. Factually, there is no relationship of landlord and tenant between the petitioners and the respondent-council. Thus, the petitioners have no cause of action which may be remediable through the present proceedings.

Accordingly, the first question is answered in the negative. It is held that the petitioners have no locus standi to file the present petition.

Lest there should be miscarriage of justice on account of a technical objection, we have considered the matter on merits as well. Therefore, we proceed to consider the other contentions.

Re. (ii)

It was contended by Mr. S.P. Jain, that the respondents had no jurisdiction to pass the impugned orders. According to the learned counsel, the power to pass orders of suspension and annulment of a Resolution vested in the Deputy Commissioner and the State Government, respectively. The impugned orders having been passed by respondent Nos. 3 and 4, these are wholly lacking in jurisdiction and are, thus, vitiated.

This contention is misconceived. Learned counsel for the respondents has produced a copy of the Government Notification, dated July 30, 1966. All powers of the Deputy Commissioner u/s 232 in so far as these are relevant for the decision of the present case were conferred on the Regional Deputy Directors. It was specifically provided that the "Regional Deputy Directors, Urban Local Bodies in the State of Punjab" shall be competent to "perform in the district within the limits of their local jurisdiction, the functions of a Deputy Commissioner under the said Act------------------". In view of this Notification, the action of the Regional Deputy Director in suspending the Resolution of the Municipal Committee was in complete conformity with the provisions of law. Furthermore, the order passed by Ms. Kusumjit Sidhu on October 23, 1994, a copy of which has been produced as Annexure P-13 with the writ petition confirming the order of the Regional Deputy Director was passed by her in exercise of the powers conferred on her vide notification dated June 25,1976. It has not been averred or argued that the notification did not empower her to exercise the power u/s 232 or that it was bad in law. Consequently, it is clear that both the orders were in strict conformity with the provisions of law and cannot be said to suffer from the lack of jurisdiction.

Accordingly, the second question is also answered in the negative.

Re. (iii)

It was then contended that the impugned orders are not in conformity with the directions given by this Court in Civil Writ Petition No. 16899 of 1989. This was a Writ Petition filed by certain tenants etc. The present petitioners were not a party. The directions were given by the Court to the petitioners in that case "to file a representation to the respective Municipal Committees within six weeks". The Committees were directed to .dispose of the representation by passing a speaking order in accordance with the rules/regulations." None of the petitioners in the aforesaid case has approached this Court with the grievance that the directions have not been complied with. Furthermore, the Municipal Council in the present case has decided the dispute by passing a Resolution. The directions given by the Court have been complied with. However, the Government having not accepted the Resolution of the Council in exercise of its statutory powers, it cannot be said that the Council has failed to comply with. Even the petitioners had not submitted any representation to the Government. No direction had been given to it. Still further, it deserves notice that the instructions issued by the Government were not annulled by this Court. The petitioners had specifically questioned the validity of the Circular, dated July 21, 1986. A prayer for the quashing of this Circular had been made. However, the learned Judge who decided the writ petition did not hold the Circular to be bad in law. The prayer was not granted. It can, consequently, be deemed to have been declined.

In view of the above, the contention raised by the learned counsel for the petitioners cannot be accepted. The third question is consequently, answered in the negative and it is held that the impugned orders are not in violation of the judgment of this Court.

Re. (iv)

Lastly, it has to be considered as to whether instructions issued by the State Government or the order passed by the respondents are arbitrary and unfair so as to call for interference under Article 226 of the Constitution of India.

It deserves notice that the relationship between the landlord and tenant is of a purely contractual nature. The provisions of the Rent Restriction law do not apply. Still further the Council which is the owner of the property has a right to fix the rent or provide for its periodic increase. On account of popunst considerations, the Council may agree to fix certain terms. However, if the State Government in exercise of its statutory powers feels compelled to lay down a uniform criteria, it cannot be accused of having acted unfairly or arbitrarily. Undeniably, there is an all-round increase in prices. The cost of works to be executed by the Committees or the usual functions of maintenance of roads etc. make it incumbent for it to look for additional resources. Whenever, there is an effort to levy a new tax or fee, there is all-round resistance. On the other hand, the expenses on account of wages and even cost of maintenance are continuously rising. The inflation is a fact of life and has to be recognised. In this situation, the State Government was fully justified in laying down a uniform policy for the periodic increase in rents and for the transfer of tenancy. Its action in doing so was only a recognition of the existing situation. It was calculated to provide additional resources to the Committees. The State Government cannot be said have acted unfairly or arbitrarily. Its action calls for no interference. It is in larger public interest and deserves to be upheld.

Accordingly, even the fourth question is answered in the negative.

In view of the above, we hold that (i) the petitioners have no locus standi to file the present petition, (ii) the action of the Regional Deputy Director in suspending the operation of the Resolution and that of the Director in annulling the Resolution was not without jurisdiction, (iii) the impugned orders are in conformity with the directions given by this Court on July 20, 1993 in Civil Writ Petition No. 16890 of 1989, and (iv) the action of the respondents is in accordance with law. It is in public interest. It calls for no interference under Article 226 of the Constitution of India.

In view of the above we find no ground to interfere. Accordingly, the writ petition is dismissed. However, in the circumstances of the case, we leave the parties to bear their own costs.