M/S.Shaw Wallace & Co. Ltd vs Govindas Purushothamdas & Anr

Supreme Court27 February 2001S.V.Patil · D.P.Mohapatra

SCC(2001) 3 SCC 445
Neutral2001 INSC 121
AIRAIR 2001 SC 1387
SCR[2001] 2 SCR 134

Ratio decidendi

The rule this decision rests on

M/S. Shaw Wallace & Co. Ltd vs Govindas Purushothamdas & Anr Under the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, the term "building" includes not only the structure itself but also appurtenant structures, grounds, and outhouses let or to be let along with the main building; accordingly, structures such as platforms and henpens that form part of the premises let out must be included within the plinth area for the purpose of assessing fair rent under Section 4, regardless of whether they can independently function as buildings. The revisional jurisdiction of the High Court under Section 25 of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 is wider than the jurisdiction conferred by Section 115 of the Code of Civil Procedure, and the High Court is entitled to interfere with concurrent findings of fact recorded by lower courts where those findings have been arrived at illegally or incorrectly, such as where the courts have ignored admissions in pleadings or misconstrued the provisions of the Act. ---

District Magistrate, Allahabad & Anr vs Harminder Pal Singh & Anr Where a Government order prescribes a specific procedure for construction on Nazul land and the Development Authority has granted sanction in accordance with that procedure, a subsequent order imposing different conditions does not override the earlier sanction, and the District Magistrate's permission, though required, must be exercised in conformity with the Government order and cannot be withheld on grounds inconsistent with it.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

CASE NO.:Appeal (civil) 1565 of 2001Special Leave Petition (crl.) 7960 of 2000

PETITIONER:M/S.SHAW WALLACE & CO. LTD.

Vs.

RESPONDENT:GOVINDAS PURUSHOTHAMDAS & ANR.

DATE OF JUDGMENT: 27/02/2001

BENCH:S.V.Patil, D.P.Mohapatro

JUDGMENT:

D.P.Mohapatra,J.

L.....I.........T.......T.......T.......T.......T.......T..J

Leave granted. Whether the revisional order dated24th December, 1999 passed by the High Court of Madras inC.R.P.No.2317 of 1996 suffers from any serious illegalitywhich warrants interference by this Court is the questionfor determination in this case. M/s.Shaw Wallace & Co.Ltd., the tenant in occupation of the premises, has filedthis appeal assailing the aforementioned order of the HighCourt. The proceeding was initiated on the applicationfiled by the landlords Shri Govindas Purushothamdas andShri Girdhari Govindas, respondents herein, for fixation offair rent of the premises under Section 4 of the Tamil NaduBuildings (Lease and Rent Control) Act, 1960 (hereinafterreferred to as the Act). The controversy in the presentproceeding relates to inclusion of the area of 1752 sq.ft.(approximately) described as platform and henpen as a partof the building. The Rent Controller and the AppellateAuthority excluded the said area and assessed the fair renton the basis of plinth area of 4850 Sq.ft. The fair rentwas calculated as Rs.22403/- per month. In the revisionpetition filed by the landlord under Section 25 of the Act,the High Court set aside the order of the trial Court asconfirmed by the Appellate Authority determined Rs.28,000/-in place of Rs.22,403/- per month as fair rent. The saidorder is under challenge in this appeal. The main thrust ofthe submissions made by Dr.A.M.Singhvi, learned seniorcounsel appearing for the appellant is that the High Courterred in including the henpen and platform within theplinth area of the building. According to the learnedcounsel, those structures cannot be said to be a part of thebuilding and cannot be utilised as such. He furthercontended that the High Court should not have interferedwith the concurrent findings of fact recorded by the trialCourt and the Appellate Authority that the area covered bythe henpen and platform is not a part of the building.Per contra, Shri T.L.V.Iyer, learned senior counselappearing for the respondents, contended that in this casethe High Court was justified in interfering with the orderof the trial Court which was confirmed by the AppellateCourt, since the courts below had overlooked the admissionof the landlord in the pleadings that the plinth area of thestructure in occupation of the tenant is 6602 Sq.ft. (not4850 Sq.ft.). Before proceeding to consider the merits ofthe contentions raised by learned counsel for the parties,it will be convenient to notice some provisions of the Actwhich are relevant for the case. Section 2(2) of the Act,which defines building reads as follows:

2(2) building means any building or hut or part ofa building or hut, let or to be let separately forresidential or non-residential purposes and includes- (a)the garden, grounds and out-houses, if any, appurtenant tosuch building, hut or part of such building or hut and letor to be let along with such building or hut, (b) anyfurniture supplied by the landlord for use in such buildingor part of a building or hut, but does not include a room ina hotel or boarding house;.

Section 4, which deals with the fixation of fair rentreads: 4. Fixation of fair rent.- (1) The Controllershall on application made by the tenant or the landlord of abuilding and after holding such enquiry as he thinks fit,fix the fair rent for such building in accordance with theprinciples set out in the following sub- sections. (2) Thefair rent for residential building shall be nine per centgross return per annum on the total cost of such building.(3) The fair rent for any non-residential building shall betwelve per cent gross return per annum on the total cost ofsuch building. (4) The total cost referred to insub-section (2) and sub-section (3) shall consist of themarket value of the site in which the building isconstructed, the cost of construction of the building andthe cost of provision of anyone or more of the amenitiesspecified in Schedule I as on the date of application forfixation of fair rent.

Provided that while calculating the market value ofthe site in which the building is constructed, theController shall take into account only that portion of thesite on which the building is constructed and of a portionupto fifty per cent, thereof of the vacant land, if any,appurtenant to such building the excess portion of thevacant land, being treated as amenity.

Provided further that the cost of provision ofamenities specified in Schedule I shall not exceed (i) inthe case of any residential building, fifteen per cent; and

(ii) in the case of any non-residential building,twenty-five per cent of the cost of site in which thebuilding is constructed, and the cost of construction of thebuilding as determined under this section.

(5)(a) the cost of construction of the buildingincluding cost of internal water-supply, sanitary andelectrical installations shall be determined with due regardto the rates adopted for the purpose of estimation by thePublic Works Department of the Government for the areaconcerned. The Controller may, in appropriate cases, allowor disallow an amount not exceeding thirty per cent, ofconstruction having regard to the nature of construction ofthe building.

(b) The Controller shall deduct from the cost ofconstruction determined in the manner specified in clause

(a), depreciation, calculated at the rates specified inSchedule II. [Emphasis supplied]

The other statutory provisions, which is relevant, isSection 25(1) which provides for a revision to the HighCourt. The provision is quoted hereunder:

25. Revision.- (1) The High Court may, on theapplication of any person aggrieved by an order of theAppellate Authority, call for and examine the record of theAppellate Authority, to satisfy itself as to the regularityof such proceeding or the correctness, legality or proprietyof any decision or order passed therein and if, in any case,it appears to the High Court that any such decision or ordershould be modified, annulled, reversed or remitted forreconsideration, it may pass orders accordingly.ú [Emphasissupplied]

Schedule I in the Act enumerates the amenities withinthe meaning of Section 4 of the Act. From a plain readingof the statutory provisions quoted above, it is clear thatthe expression building includes any building with thegarden, grounds and out-houses appurtenant to such building,or part of such building let or to be let along with suchbuilding. In view of the expansive definition of the term,any structure which is part of the premises let out or to belet out comes within the purview of building. Thisposition becomes further clear on reading sub-section (4) ofSection 4 wherein it is provided that the total costreferred to in sub-section (2) and sub-section (3) shallconsist of the market value of the site in which thebuilding is constructed, the cost of construction of thebuilding and the cost of provision of anyone or more of theamenities specified in Schedule I as on the date ofapplication for fixation of fair rent. In the first provisoto the sub- section (4) it is laid down while calculatingthe market value of the site in which the building isconstructed, the Controller shall take into account onlythat portion of the site on which the building isconstructed and of a portion upto fifty per cent thereof thevacant land, if any, appurtenant to such building, theexcess portion of the vacant land, being treated as amenity.

Reading the two provisions together, it is clear to usthat for the purpose of assessment of fair rent not only thearea on which the building is constructed, but also the landappurtenant to it subject to the limit prescribed in theStatute and other structure appurtenant to the main buildingand also the amenities described in Schedule I of the Actare all to be taken into account. Therefore, the contentionraised by Dr.Singhvi that the platform and the henpen arenot to be included in calculating the area for the purposeof assessment of fair rent, since it cannot be used as abuilding, cannot be accepted having regard to the factsfound in the case. The High Court, in our considered view,did not commit any illegality in including the saidstructures within the plinth area for the purpose offixation of fair rent.

Coming to the question of revisional jurisdiction ofthe High Court under Section 25 of the Act, the contentionraised by Dr.Singhvi is that the limited jurisdiction vestedin the said Sectin does not permit the High Court to disturbconcurrent findings of fact recorded by the courts below.

From the judgment/order of the High Court it ismanifest that the High Court felt inclined to interfere withthe orders passed by the Courts below mainly for the reasonthat the Courts below had ignored the specific averment madeby the landlords in their pleadings that the total plintharea is 6602 Sq.ft. which was admitted by the tenant to betrue in para 12 of its counter affidavit. The question,therefore, is the High Court not have the power to disturbthe findings of fact concurrently recorded by the Courtsbelow in such circumstance?

On a plain reading of Section 25 of the Act, it isclear that the revisional jurisdiction vested in the HighCourt under that Section is wider than Section 115 of theCode of Civil Procedure. The High Court is entitled tosatisfy itself as to the regularity of the proceeding of thecorrectness, legality or propriety of any decision or orderpassed therein and if, on examination, it appears to theHigh Court that any such decision or order should bemodified, annulled, reversed or remitted forreconsideration, it may pass such orders accordingly.

In the case of M.S.Zahed vs. K.Raghavan reported in[1999] 1 SCC 439, this Court, interpreting Section 50 of theKarnataka Rent Control Act, 1961 which is pari materia toSection 25 of the Tamil Nadu Buildings (Lease and RentControl) Act, 1960, held that it is within the scope ofrevisional jurisdiction of the High Court to interfere withthe findings of fact, illegally or incorrectly arrived at.

In the present case, the trial Court and the AppellateCourt had not only ignored the admission of the landlord inthe pleadings but also misread and misconstrued theprovisions of the Act. In the circumstances, the High Courtcannot be faulted for having interfered with thejudgments/orders of the Courts below and modifying the fairrent as assessed therein. The contention raised byDr.Singhvi questioning the jurisdiction of the High Courthas also to be negatived.

In the result, the appeal being devoid of merit, isdismissed with costs. Hearing fee is assessed atRs.10,000/-.

On the prayer made by Dr.A.M.Singhvi, learned seniorcounsel, the appellant is granted one month time to pay thearrear rent due in compliance of the order passed by theHigh Court.

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURSIDICTION

CIVIL APPEAL NO. 1874 OF 1992

District Magistrate, Allahabad & Anr. Appellants

Versus

Harminder Pal Singh & Anr. Respondents

J U D G M E N T

RAJENDRA BABU, J. :

A lease was granted for a piece of Nazul land bearing plot No. 8, Nashibpur, Baskhtiara, Allahabad to one Begum Mehdi Husain for a period of 30 years from August 21, 1940 with the provision of two further renewals of 30 years. In 1983 the Vice- Chairman, Allahabad Development Authority (ADA) sanctioned a plan subject to countersigning by the District Magistrate. The lease was renewed on December 4, 1987 in the names of Smt. Jagjit Kaur Gulati, Shri Harminder Pal Singh, Shri Jitendra Singh, Smt. Bhulari Devi, Shri Rajendra Singh, Shri Pramod Kumar Agarwal and Nazir Faiyaz Khan. By a letter dated January 22, 1987 all the District Magistrates in Uttar Pradesh were informed regarding construction of multi storey buildings on Nazul Land to the effect that the Government has no objection for building up multi storey building in the Nazul land as per the procedure prescribed by the Government in the order dated October 16, 1986 provided the balance lease period is more than 15 years and that as per the building construction laws, the construction of the proposed building is permissible. It was also made clear therein that in case of sale of such flats, the real rent should be realised after proportionately distributing the rent between the flat owners. Based on this Government order it is stated that the plan had been sanctioned by the Vice-Chairman, ADA. When the District Magistrate did not countersign the said sanctioned plan, a writ petition was filed before the High Court. The High Court directed the Vice-Chairman, ADA to release the sanctioned plan dated May 20, 1989 in favour of the respondents. This petition was contested both by the State and by the Vice-Chairman, ADA. The stand of the appellants is that the respondents filed an application for a plan on March 10, 1989 for the construction of the multi storey residential complex which was sanctioned by the Vice-Chairman, ADA as communicated to them on May 24, 1989. It was stated that the plan could be released after countersignature was obtained from the District Magistrate. The District Magistrate did not countersign the sanctioned plan and when the matter was pending before him, another order dated November 10, 1989 had been issued which provided that before allowing residential construction of the group housing the premium and rent should be realised on commercial rates from the lessee and thus the respondents had to pay certain sum towards premium and annual rent at certain rate. The High Court felt that the only objection raised on behalf of the District Magistrate is the payment of the premium and the rent as provided in the order dated November 10, 1989. The High Court examined the provisions of the lease deed and is of the opinion that the sanction of both the Collector and the Board was not essential and it was sufficient if the Board gave its approval and, in the present case, the Vice-Chairman, ADA had given such sanction. After analysing the relevant enactments, it took the view that the powers of the Board stood transferred to different authorities and ultimately vested in the Development Authority and, therefore, the Vice-Chairman, ADA could grant sanction to the plan. The High Court, therefore, rejected the contention raised on behalf of the appellants thereby allowing the writ petition. Hence this appeal by special leave.

The lease deed has been made available to us which has been executed on behalf of the Governor of the United Provinces on the one part and Begum Mehdi Husain on the other part to be effective for a period of 30 years from August 21, 1940 which has been renewed from time to time on certain terms of agreed rent. The lease deed also provides as follows :-

AND ALSO will within twenty four calendar months next after the date of these presents at his expense and to the satisfaction of the Collector for the time being of Board of Allahabad in a good substantial and workmanlike manner erect and complete on such parts of the said premises as are marked out on the plan hereto annexed a dwelling-house and out-buildings according to a plan and elevation to be approved by such Collector which dwelling-house Board and out-buildings shall be of the value of Rs. 5,000/- at least AND ALSO that no part of the external elevation or plan of such dwelling-house and out-buildings shall at any time be altered or varied from the original elevation or plan thereof without the written consent of such Collector and no other building shall be erected on Board the said premises without the like consent.

This lease deed had been granted for and on behalf of the Government is clear in terms of Article 299 of the Constitution and it is also clear by the communication No. 278/9- Nazul-87/485N/86 the Government had instructed all the District Magistrates as to the manner of construction of multi storey buildings also to be made on Nazul land, to which we have adverted to. By letter dated January 22, 1987 when that procedure had been prescribed and the lease itself is under the Nazul Rules framed pursuant to the executive orders of the Government, we fail to understand as to how any other procedure is required in matters of this nature. The argument that the permission of the Collector or the Board is required in spite of orders made by the Government dated January 22, 1987 is untenable. Under the terms of the orders of the Government all the District Magistrates are bound to act and permit the construction on such land. Such buildings can be constructed under the Building Construction Laws. Under the Uttar Pradesh Urban Planning and Development Act, 1973, the development can take place in terms of Section 14 of the Urban Planning and Development Act, 1973 and whenever any development takes place, sanction of the Development Authority is required. Thus the construction had to be made only under the Building Construction Laws as stated in the Government order and there is no other requirement to be complied with. Therefore, it is unnecessary to engage our attention to the argument advanced on behalf of the appellants that the sanction of the Collector as well as the Board is required in a matter of this nature. Apart from the ambiguity arising on account of non-striking off of irrelevant portions in the lease deed, the Government order makes it clear the manner of construction of multi storey buildings on Nazul Land, the same can be complied with. If that is so, the District Magistrates or the Collectors permission though required, it will have to be in terms of the Government order dated January 22, 1987. Thus the later order issued on November 10, 1989 had no application to the case since sanction had been given to the plan by the Vice-Chairman, ADA on May 24, 1989. Thus the view taken by the High Court is unexceptionable and calls for no interference.

Therefore, we dismiss this appeal.

..J. [ S. RAJENDRA BABU ]

..J. [ SHIVARAJ V. PATIL ] NEW DELHI, MARCH 2, 2001.

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