Case: Accountant and Secretarial Services Pvt. Ltd. and Ors Vs. Union of India (UOI) and Ors


Decision reasoning: 0[ds]10. It has been mentioned earlier that the Bank had served a notice on the appellants under the 1956 Act. This Act, which received the assent of the President on 30th March, 1956, is on the pattern of the lease and rent control legislation prevalent in various States. It regulates, inter alia, the matter of eviction of tenants of buildings situated in Calcutta and certain important cities and localities of the State where there is scarcity of housing accommodation. It is not necessary to set out the provisions of this Act except one. Under the second proviso to Section 1(3) the Act is not to apply to (a) any premises belonging to any local authority, (b) any premises belonging to or requisitioned by Government and (c) any tenancy created by Government in respect of any premises taken on lease by Government. The premises in the present case does not fall within any of these categories and, according to the appellants before us, the provisions of 1956 Act were squarely applicable and should have been resorted to by the Bank for evicting them. This is one.The definitions of land, public land and unauthorised occupation contained in Sections 2(2), 2(7) and 2(8) are so wide as to leave no doubt that the premises belonging to the Bank would be within the scope of the said Act and that proceedings for eviction of the appellants could also be initiated by the Collector under that Act. It thus appears that the procedure for the eviction of the petitioners will be governed by the 1971 Act as well as either or both of the State Acts13. One thing may be made clear at the outset. The present argument may not have been open to the appellants if the premises of the bank could be said to be premises belonging to the Union Government. In that case, the legislation to the extent it governs such premises can be said to fall under entry 32 of List I as one covering the property of the union. Though, the premises being situated in Calcutta, any legislation under that entry in regard thereto would be subject to State legislation, the State legislation can only govern save in so far as Parliament by law otherwise provides. Parliament having provided otherwise by the 1971 Act, that Act will, it can be said, prevail over the 1956 and 1962 Acts. It is, however, common ground before us that though the Bank is a corporation wholly owned and controlled by the Government, it has a distinct personality of its own and its property cannot be said to be the property of the Union. The position, indeed, is beyond the pale of controversy after the decisions of this Court in Bacha F. Guzdar v. C.I.T. [1955]27ITR1(SC) ; State Trading Corporation of India Ltd. v. C.T.O. [1964]4SCR99 ; A.P. State Road Transport Corporation v. I.T.O., [1994]52ITR524(SC) ; Heavy Engineering Mazdoor Union v. State (1969)IILLJ549SC ; Vidarbha Housing Board v. I.T.O. [1973]92ITR430(Bom) and Western Coalfields Ltd. v. Special Area Development Authority, [1982]2SCR1 . It is, therefore, not possible for the respondents to support the legislation, qua the premises in question, under Entry 32 of List I.We do not, however, propose to discuss these cases at length firstly, because there is a contrary line of decisions also vide Mangtulal v. Radheshyam, AIR1953Pat14 ; Milap Chand v. Dwarakadas, Nawal Mal v. Nathu Mal, AIR 1962 Raj 193, Rama Sundari v. Indu Bhushan, AIR1967Cal355 ; L.S. Nair v. Hindustan Steel Ltd., AIR1980MP106 and Bapalal and Co. v. Thakur Das, AIR 1982 Mad. 309 and the judgment presently under appeal and secondly, because a question as to the interpretation of Entry 18 (or its predecessor, Entry 21 of the Provincial List under the Government of India Act, 1935, (hereinafter referred to as the 1935 Act) had arisen before the Federal Court and the Privy Council and some of the above judgments have also been considered in certain earlier decisions of this Court.15. Stopping here for a brief review of the above decisions, it will be seen that except for Indu Bhushans case which will be discussed later, the other rulings are not helpful in deciding the issue before us. Atiqa Begum and Atma Ram concerned a legislation that clearly pertained to land-in fact, land governed by systems of land tenure prevalent in the States of Uttar Pradesh and Punjab. In Allah Rakhia, the impugned Act was limited to agricultural land and, since the items in the concurrent list excluded such land, was covered by Entry 21. In Maneklal, the legislation primarily concerned land, though not agricultural land, for, as observed in State v. Peter, [1980]3SCR290 , land is at the base of all development. It is not quite certain that the provisions of the Act also affected buildings, but if indeed any buildings were affected, that was only incidental. As pointed out by the Court, the primary target of the legislation was only urban land, the ways and means of developing it and proper utilisation of land situate within the municipal limits. These decisions no doubt establish two propositions : (1) The opening word land in entry 18 is not restricted to agricultural land as are the latter portions of it. It would cover all types of land-rural or urban, agricultural or non-agricultural, vacant fallows or pastures. (2) The words which follow land only make it clear that the legislative entry takes in not merely the tangible immovable property one normally describes as land but also all kinds of intangible rights or interests, in or over, land in the broad sense explained above. The phrases which follow the words rights in or over land in the entry are illustrative and are not restrictive. They only make it clear that the legislative entry takes in not merely the tangible immovable property one describes as land but also all kinds of intangible rights or interests, in or over, land in the broad sense explained above. But none of the decisions contain any support for the further proposition that the legislative entry should be so interpreted as to cover houses and buildings as well as the relationship of landlord and tenant in regard thereto or the collection of rents therefrom. We are unable to agree with Dr. Chitale that this further proposition emerges from the decision in Union of India v. Valluri B. Chaudhary [1979]3SCR802 . The Urban Land Ceiling Act also was a legislation primarily intended to deal with vacant lands. If one scans the provisions of the Act it is clear that the theme of the Act was only to place a ceiling on vacant lands in cities or what we call urban agglomerations and to ensure equitable distribution of such urban vacant lands. The pith and substance of the legislation was with regard to urban land and its provisions in respect of buildings were incidental to the main objective of the urban land ceiling. In this context, it is perhaps not without significance that as against the proposal of the States for a ceiling on urban immovable, property Parliament restricted the legislation to vacant land. In the light of these circumstances the declaration in the preamble to the Act is basically correct that the pith and substance of the legislation was land and this is exclusively within the States legislative domain by virtue of Entry 18 of List II. We do not also agree with the counsel that the passage extracted from the judgment reflects a decision of the Court that land includes lands and buildings. It proceeds on a concession to that effect. That apart, the context of the above observation is also interesting. The Court was dealing with a contention that the resolution of the States had authorised Parliament to impose a ceiling on urban immovable property and that the legislation imposing a ceiling on urban land was on a different subject and thus contrary to the resolution. The Court, rejecting this argument, pointed out that since urban immovable property was a wider expression which also included land, there was no contradiction between the resolution and the legislation. It is in this context that a reference, on admission, regarding the scope of Entry 18 finds a place in the passage. Neither was the scope of the entry in issue in the case nor can the isolated sentence, on admission, be treated as a decision by the court.17. We are not, however, persuaded that Indu Bhushans case is capable of being brushed aside so easily. It is true that, ultimately, the decision in that case turned on the wider interpretation of Entry 2 of List I favoured by the Supreme Court in preference to the narrower one preferred by Bombay. Nevertheless the judgment contains a specific discussion of the terms of Entry 21. This is because the Bombay High Court had first discussed the terms of this entry and expressed an opinion thereon. The Supreme Court considered the High Courts interpretation of the entry and disagreed therewith. The view of the Supreme Court on the entry has been set out in some detail and cannot be ignored. Not only this, in the last para of its judgment the Court has reaffirmed the earlier discussion and interpretation. We have extracted earlier this concluding para of the judgment. In our view the effect of this para cannot be explained away by trying to analyse the Calcutta and Rajasthan decisions to see what they had actually decided. The important thing is how the Supreme Court understood what the two High Courts had decided. This is set out in the two sentences of the last paragraph of the judgment, which have been underlined in the extract set out earlier. The Supreme Court then specifically affirmed this to be the correct ratio. We are, therefore, of the opinion that Indu Bhushan must be taken to have expressed a view that premises tenancy legislation in so far as it pertains to houses and buildings is referable not to entry 18 of List II but to entries 6, 7 and 13 of List III.The decision of the larger Bench of the Supreme Court in V. Dhanpal Chettiar v. Yesodai Ammal [1980]1SCR334 , also reinforces the same line of thinking. The question for consideration in this case was whether, in respect of a tenancy governed by Tamil Nadu Buildings (Lease and Rent Control) Act, it was necessary for the landlord to issue a notice under Section 106 of the Transfer of Property Act terminating the tenancy before he could obtain an order of eviction against the tenant. This question was answered in the negative. In the course of its discussion the Supreme Court observed as follows:Under the Transfer of Property Act the subject of leases of Immovable Property is dealt with in Chapter, V. Section 105 defines the lease, the lessor, the lessee and the rent. Purely as a matter of contract, a lease comes into existence under the Transfer of Property Act. But in all social legislations meant for the protection of the needy, not necessarily the so-called weaker section of the society as is commonly and popularly called, there is appreciable inroad on the freedom of contract and a person becomes a tenant of a landlord even against his wishes on the allotment of a particular premises to him by the authority concerned. Under Section 107 of the Transfer of Property Act a lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument. None of the State Rent Acts has abrogated or affected this provision. Section 108 deals with the rights and liabilities of lessors and lessees. Many State Rent Acts have brought about considerable changes in the rights and liabilities of a lessor and lessee, largely in favour of the latter, although not wholly. The topic of Transfer of Property other than agricultural land is covered by Entry 6 of List III in the Seventh Schedule to the Constitution. The subject being in the Concurrent List, many State Rent Acts have by necessary implication and many of them by starting certain provisions with non-obstante clause have done away with the law engrafted in Section 108 of the Transfer of Property Act except in regard to any matter which is not provided for in the State Act either expressly or by necessary implication.19. The above passage clearly proceeds on the view that the subject matter of housing accommodation falls within the purview of the Concurrent List. It would have strengthened the landlords contention in Dhanpal Chettiars case to urge that the terms of the house control legislation being traceable to List II and not to List III, the provisions of the Transfer of Property Act could not affect the same at all. If Indu Bhushan had been understood as having left the question open, it is difficult to imagine that, before the larger Bench of the Court, counsel would not have raised the issue again. The discussion and ratio of Dhanpal Chettiar fall into dace only on the view that by that time it was taken as settled law that State House control legislations were referable to the legislative powers conferred by the Concurrent List.20. So much in regard to precedents. But, leaving precedents aside, let us proceed to consider the terms of the legislative entry itself, treating the observations in Indu Bhushan as merely of persuasive value. We agree that entry 18 should be given as wide a construction as possible consistent with all the other entries in all the three legislative lists. The entry deals with four main topics : land, transfer and alienation of agricultural land, land improvement and agricultural loans and colonisation. The second and third of these clearly pertain to agricultural land. Perhaps the last also does, because, usually, by colonisation we mean conversion into buildings and industrial sites of what was previously agricultural land but, may be, it is wider and includes colonisation of vacant non-agricultural land as well. Any way, as the decisions have unanimously held there is no reason why the first topic viz. land should be narrowly interpreted. It should be understood as including all types of land rural or urban, agricultural or non-agricultural, arid, cultivated, fallow or vacant. But, what is land? This can be gathered from the other words of the entry which attempt a paraphrase.21. In our opinion, the true import of the word land can be gathered if we try to ascertain the proper interpretation and ambit of these three phrases, particularly, the first two among them, in the context of other entries in the Union List.That is the question. After careful consideration, we have reached the conclusion that the answer to this question has to be in the negative for a number of reasons:1. As pointed out in Megh Raj, there was good reason for placing land in the Provincial List. Land indeed is primarily a matter for provincial concern. It is well known that land in each Province had its special characteristics. There were local customs and traditions in regard to landholding and particular problems of local concern which required provincial consideration. There are no such special features that require placing buildings also in the State list. The problem of scarcity of house accommodation is a general feature all over the country thanks to Indias post-independent industrial development involving large influxes of population into towns, big and small, from the villages. Urban housing problems are almost the same throughout the country despite minor differences here and there and uniform nationwide legislation in regard thereto, atleast on some common aspects, is also a necessary desideratum. In other words, the subject is appropriate for an entry in the Concurrent List. Such a need for a uniform legislation by the center was felt even in respect of vacant urban land, (where unlike agricultural land, there are no special features which need varying provincial treatment) despite its being on the State List. It is all the more imperative in respect of public premises, i.e., buildings belonging to the Union or to public sector corporations which have all-India operations. It is, therefore, only appropriate that buildings should be an item in the Concurrent Legislative List.2. A scrutiny of the Legislative lists would show that the Constitution uses different expressions in different places, appropriate to the context and these entries indicate an awareness on the part of the Constitution of the distinction between various kinds of property. Entries 32, 87 and 88 of List I and Entry 6 of List III use the word property, a word of the widest connotation, which takes in not merely land, buildings and other immovable properties but also all kinds of rights and interests in tangible and intangible properties. There are Entries 35 and 49 of List II which make specific reference to lands and buildings. The expression land is used, therefore, obviously where reference to land only is intended. Even the width of this expression is cut down and reference is confined only to agricultural land as in Entries 47 and 48 of List II, 6 and 7 of List III and even 18 of List II. In this scheme of the entries, it would be inappropriate to interpret the word land in Entry 18 as including buildings also.3. The Bombay case, in interpreting Entry 21 of the 1935 Act, was bound to take into account the terms of Section 3 of the (English) Interpretation Act, 1889 which specifically defined land in the widest sense as including all messages, tenements and hereditaments, houses, and buildings of any tenure. The assistance of the Interpretation Act cannot be invoked to interpret the entries in the Constitution.4. The entry in question specifically refers to the relationship of landlord and tenant but this is in the part of the entry which reads : land tenures including the relationship of landlord and tenant. The words land tenures, are not followed by a comma in some of the editions though the 1935 Act and some of the other editions and text books on the Constitution have a comma in between. But this makes no difference. The words tenant and tenure have a common derivation and the expression tenure no doubt comprehends within it the relationship of landlord and tenant. But this had to be specified and clarified because in India, the expression land tenures, as pointed out in Indu Bhushan, has acquired a special significance. It connotes various types of holdings of land, involving the King or the Government, the zamindar, the inamdar and various other types of holders, lessors, sub-lessors, lessees and sub-lessees under or through them and evolved at various stages of Indian history by various rulers, nawabs and chieftains Hindu, Muslim and British-differently in different parts of the country. Sir Baden Powell has written a vast treatise on such law systems prevalent in India. The Constitution in Section 31A contains a clue that expression like estate and land tenures have a special meaning in relation to land, connoting the relationship among its owner, holder and other intermediary for the time being, be it on tenancy or otherwise and the collection of rents therefrom. Section 31A also describes some of these relationships. The system had developed so many complications and nuances that a determined liquidation of all these special types of relationships had to be achieved by special provisions in the chapter on fundamental rights. Viewed in this background, the words relationship of landlord and tenant and the collection of rents cannot impart a wider meaning to the words land and land tenure used in the entry.5. While, on the one hand, the words in Entry 18 have to be given the widest meaning possible, it has to be borne in mind that the entries in the various lists have to be read together and construed in such a manner as to give a meaning and content to all of them. We need hardly say that the Constitution should be so interpreted as to reconcile all concerned and relevant entries (See : Hoechst Pharmaceuticals v. State [1985]154ITR64(SC) and the Dhillon case [1972]83ITR582(SC) . If we give the word land a meaning so as to include buildings and also give the words rights in or over land a wide interpretation as we have to, in view of the discussion and ratio in Megh Raj v. Allah Rakhia, AIR 1947 P.C. 72 this entry will be seen to cover almost all kinds of not only transfer but also alienation and devolution of, or even succession to, lands and buildings. The interpretation thus placed will affect not merely leases and, therefore, a small part of the contents of the item regarding transfer of property; it will apply equally to sales, mortgages, charges and all other forms of transfer of all kinds of interests in land and buildings and thus make such a substantial inroad into the scope of Entry 6 in the concurrent list as to denude it of all application except to property other than land and buildings. The word property used in Entry 6 will thus lose even its normal meaning not to speak of its being given the widest meaning possible appropriate to a legislative entry. It will mean that though transfer of property-other than agricultural land-is in the Concurrent List, the State will have exclusive power to legislate in respect of transfer of all property in the nature of land and buildings; in other words, for the words transfer of property other than agricultural land, we will be substituting transfer of property other than lands and buildings. It will mean that though wills, intestacy and succession are in item 5 of the Concurrent List, the State can legislate exclusively in respect of devolution of land and buildings of all description. It will render Entry 35 of List II a surplusage in so far as it refers to lands and buildings. We do not think that such an interpretation should be favoured. The more harmonious interpretation would be that any subject matter that involves the element of transfer or alienation of any property (other than agricultural land) or of devolution (on testamentary of intestate succession) of any property or contract (other than one in relation to agricultural land) will fall in the Concurrent List and not in the State List even though it may relate to land or buildings.6. Another feature of the entries in the Lists also lends support to our view. Reference has been made to Entry 3 of List I by which, inter alia, Parliament has been given exclusive power to enact lease and rent control legislation in cantonment areas. Entry 5 of List II is the corresponding entry regarding local self government in areas of States excluding cantonment areas. Had it been the intention to confer legislative power on the State Legislature in regard to housing and rent control accommodation in the States, one would have expected a repetition in Entry 5 of List II or, at least, in entry 18 of List II of the words of entry 3 of List I. We do not think that the omission of those crucial words in Entry 5 or 18 can be attributed to more inadvertence .7. We have earlier referred to Dr. Chitales reference to the Urban Land Ceiling Act, 1971 and pointed out how the preamble to the Act does not support counsels interpretation of Entry 18. We may point out, on the other hand, that quite a few (though not all) State Legislations on house and rent control (including the 1956 Act) have been enacted after obtaining the Presidents assent. This indicates a legislative recognition that such legislation stems from the Concurrent List and not the State List.8. The learned Attorney General sought to derive some support for his contention also from the wording of Entry 32 of List 1 which deals with the property of the Union, an expression wide enough to comprehend all kinds of property, essentially lands and buildings. It does three things at the same time:(a) it enables Parliament to legislate exclusively with respect to all property belonging to the Union;(b) it, however, subjects such power, in so far as property situated within the territory of any State is concerned, to any legislation of the State in regard thereto;(c) it nevertheless authorises Parliament to provide otherwise by law.This language is somewhat analogous to that of Article 254(2) and is consistent with a special provision for an item, which, otherwise, would primarily be covered by the Concurrent List on which both Parliament and State Legislature can legislate. It may be usefully contrasted with Entries like Nos. 23 and 24 of List 11 where the language of the entry clearly grants primacy to Parliamentary legislation in regard to a part of the field occupied by an entry in the State List. There is some force in this contention which, effectively, is that if land and buildings were so clearly covered by Entry 18 of List II, either the wording of entry 32 would have been made subject to List II of Entry 18, in this regard, like Nos. 23 and 24 would have been made subject to List I.9. It is also a relevant consideration that, while the interpretation suggested by appellants completely denies power to Parliament to legislate on the subject matter under consideration, the interpretation preferred by us does not exclude the States power to legislate with respect to the topic. It recognises a concurrent power in Parliament and State Legislatures.22. For the reasons discussed above, we are of opinion that all the legislations coming up for consideration in the present case are referable to entries in the Concurrent List and the topic of legislation is not referable to Entry 18 List II. The provisions of the 1971 Act, in so far as they are made applicable to the premises of the respondent bank are, therefore, intra vires and valid.23. Once it is held that the 1971 Act is intra vires Parliament, no further issue between the parties would seem to survive for consideration for, as we have already pointed out, no other contention was raised before the Division Bench of the High Court. However, there was some discussion before us as to whether the provisions of the 1971 Act, even if intra vires, would prevail against the provisions of the State legislations. In this context, Dr. Chitale invited our attention to Jain Ink Manufacturing Co. v. LIC, [1981]1SCR498 where this Court held that the provisions of the 1971 Act will prevail against the provisions of the Delhi Rent Control Act, 1956 and the Delhi Slum Areas (Improvement & Clearance) Act, 1956 on the grounds that it was both a later Act and a special Act. He submitted that the decision in the case is the subject matter of reference to a larger Bench and that we should, therefore, defer our decision in the present case to await the result of the reference. We do not think this is called for. In our opinion, that decision has no reference to the issues before us. In that case, all the three legislations were Parliamentary legislations (Delhi being a Union Territory) and the question was regarding the inter-se overlap among the three Acts touching upon the same subject matter viz. eviction of a tenant by a landlord. Here the legislations which are said to occupy the same field are one of Parliament of 1971 and two of the State of West Bengal of 1956 and 1962, all passed in exercise of the powers conferred with respect to matters contained in the Concurrent List. The resolution of a conflict, if any, between the two will have to be in terms of Article 254 of the Constitution.25. The present case is clearly governed by the primary rule in Article 254(1) under which the law of Parliament on a subject in the Concurrent List prevails over the State law. Article 254(2) is not attracted because no provision of the State Acts (which were enacted in 1956 and 1962) were repugnant to the provisions of an earlier law of Parliament or existing law. The fact that the 1956 Act was enacted, after being reserved for the Presidents assent is, therefore, immaterial. Even if the provisions of the main part of Article 254(2) can be said to be somehow applicable, the proviso, read with Article 254(1) reaffirms the supremacy of any subsequent legislation of Parliament on the same matter even though such subsequent legislation does not in terms amend, vary or repeal any provision of the State Legislation. The provisions of the 1971 Act will, therefore, prevail against those of the State Acts and were rightly invoked in the present case by the respondent Bank.We do not see any substance in this contention. In the very nature of things, only an officer or appointee of the Government, statutory authority or Corporation can be thought of for implementing the provisions of the Act. That apart, personal bias cannot necessarily be attributed to such officer either in favour of the bank or against any occupant who is being proceeded against, merely because he happens to be such officer. Moreover, as pointed out earlier, the Act provides for an appeal to an independent judicial officer against orders passed by the Estate Officer. These provisions do not, therefore, suffer from any infirmity. In fact, Dr. Chitale did not pursue this objection seriously.