Case: New Delhi Municipal Committee Vs. Kalu Ram &amp; Anr

1. Respondent Kalu Ram was avendor in Connaught Place, New Delhi. In 1950 the appellant, New Delhi Municipal Committee, provided a number of displaced persons with small prefabricated stalls to enable them to do their business. Kalu Ram who was also a displaced person was allotted one such stall on Irwin Road. Rupees thirty was the licence fee payable per month by the allottees ofstalls. Later, the allottees, including the respondent, applied to the Rent Controller for reducing the rent. It is not necessary to refer to the various proceedings arising from these applications for fixation of standard rent which were ultimately dismissed by the Circuit Bench of the Punjab High Court at Delhi as not maintainable. In the meantime many of the allottees fell in arrears in paying the licence fees. So far as the respondent isthe appellant took no steps to recover the dues till December, 1960 when it demanded the entire amount in arrears from May, 1950 to April, 1957. The respondent not having paid, the appellant asked the Estate Officer, appointed under Section 3 ofthe Public Premises (Eviction of Unauthorised Occupants) Act, 1958 to take steps to recover the amount in arrears under Section 7 of that Act. The Estate Officer, who is the second respondent herein, made an order on September 28, 1961 under Section 7(1) of the Act asking the respondent to pay the sum overruling his objection that the claim was barred by limitation. Theappeal to the Additional District Judge from the Estateorder was disallowed. The respondent then filed a Writ Petition before the Circuit Bench of the Punjab High Court at Delhi challenging the order against him. One of the grounds of challenge was that Section 7 could not beto for recovery of the sum as the claim was time barred. The High Court accepted the contention and allowed the petition. In this appeal by certificate, the appellant, New Delhi Municipal Committee, questions the correctness of the High

Court's reasoning:
would appear from the terms of the section, it provides aprocedure for the recovery of arrears of rent. It was argued that since Section 7 did not put a time-limit for taking steps under that Section and as the limitation prescribed for a suit to recover the amount did not apply to a proceeding under this section, the High Court was in error inobjection. In support of his contention that a debt remained due though barred by limitation, Mr. Hardy relied on a number of authorities, both Indian and English. We do not consider it necessary to refer to these decisions because the proposition is not disputed that the statute of limitation bars remedy without touching the right. Section 28 of the Indian Limitation Act, 1908 which was in force at the relevant time, however, provided that the right to any property was extinguished on the expiry of the period prescribed by the Act for instituting a suit for possession of the property. But on the facts of this case no question of a suit forof any property arises and Section 28 has no application. It is notthat a creditor whose suit is barred by limitation, if he has any other legal remedy permitt him to enforce his claim, would be free to avail of it. But the question in every such case is whether the particular statuteder Section 7 the Estate Officer may order any person who is arrears of rent payable in respect of anypremises to pay the same within such time and in such instalments as he may specify in the order. Before, however, the order is made, a notice must issue calling upon the defaulter to show cause why such order should not be made and, if he raised any objection, the Estate officer must consider the same and the evidence produced in support of it. Thus the Estate Officer has to determine upon hearing the objection the amount of rent in arrears which isis somewhat indefinite in import and its meaning must be gathered from the context in which itly means that which should be paid. If the person in arrears raises a dispute as to the amount, the Estate Officer inthe amount payable cannot ignore the existing laws. If the recovery of any amount is barred by the law of limitation, it is difficult to hold that the Estate Officer could still insist that the said amount was payable. When a duty is cast on an authority to determine the arrears of rent themust be in accordance with law. Section 7 only provides a specialfor the realisation of rent in arrears and does not constitute aof foundation of a right to claim a debt otherwiseare clear that the wordin Section 7, in the context in which it occurs, means legallyAdmittedly a suit to recover theinstituted on the day the order under Section 7 was made would have been barred by limitation. The amount in question was, therefore