judgement:
Appeal No. 1744 of 1976.
(Appeal by Special Leave from the Judgment and Order dated 28.4.1975 of the Punjab & Haryana High Court in Civil Writ Petition No. 1819/75) M.K. Ramamurthi and J. Ramamurthi, for the appellants.
Madan Mohan, for the respondents 4 8, 10 25, 27 30 & 32 36.
B.D. Sharma & R.N. Sachthey, for respondents 1 2.
The Judgment of the Court was delivered by JASWANT SINGH, J.
This appeal by special leave which is directed against the judgment and order dated April 28, 1975, of the High Court of Punjab and Haryana at Chandigarh, dismissing Civil Writ Petition No. 1819 of 1975 filed by the appellants and respondents 3 to 37 herein, who are industrial workers employed in Factories situate in the industrial area in Chandigarh.
The facts leading to this appeal are: In 1956, the Legislature of the then State of Punjab enacted what is called the Punjab Industrial Housing Act, 1956 (Punjab Act 16 of 1956) (hereinafter referred to as 'the Act ') to pro vide for allotment, recovery of rent, eviction and other ancillary matters in respect of houses constructed under the subsidised Industrial Housing Scheme for industrial workers in the State of Punjab.
In exercise of the powers conferred on it under section 24 of the Act, the State Government made rules called the Punjab Industrial Housing Rules, 1956 (hereinafter referred to as the Rules ').
Rule 4 of the Rules as originally made ran as under: "4.
Eligibility for allotment (1) Two roomed tenements shall be allotted to indus trial workers whose income exceeds Rs. 100 per mensem.
(2) One roomed tenements shall be allotted to workers with an income not exceeding Rs,100 per mensem.
" 329 This rule was amended vide Notification No. 4119 2HG 6C 29333 dated October 5, 1960.
The rule, after its aforesaid amendment, read as under: "4.
Eligibility for allotment (1) Two roomed tenements shah be allotted to industrial workers whose income does not exceed Rs. 350.00 per mensem.
(2) One roomed/small two roomed tenements shall be allotted to workers with an income not exceeding Rs. 250.00 per mensem; provided that where sufficient number of industrial workers with income exceeding Rs. 250.00 per mensem is not forthcoming for allotment, the Labour Commissioner may, with the approval of the State Government, allot two roomed tene ments to industrial workers with an incOme not exceeding Rs. 250.00 per mensem.
Notes: In towns, where only roomed/small two roomed tenements have been built, applica tions should first be invited from such work ers only, whose monthly income does not exceed Rs. 250.00.
It is only after the demand from these workers has been met that unallotted tenements should be made available for allot ment to workers, whose income exceed Rs. 250.00 per mensem.
Where these tenements are given to higher paid workers the normal subsi dised rent should be charged from them till such time as the regular two roomed tenements do not become available for them.
When the two roomed tenements become available the higher paid workers must be removed from the smaller tenements, failing which they should be charged the full economic rent.
(ii) In cases where after allotment of one roomed/small two roomed tenements a worker crosses the wage limit of Rs. 250.00 per mensem, he may be allowed to continue in occupation of the house allotted to him on payment of subsidised rent, till such time as the regular two roomed house does not become available, in other respects the procedure as prescribed in note (i) should be followed.
(iii) Two roomed tenements should in the first instance, be offered from allotment to workers whose income is between Rs. 251.00 and Rs. 350.00 per mensem." Vide Notification No. 7480 4H(8) 72/21542 dated Novem ber 7, 1972, the Chief Commissioner, Union Territory, Chand igarh, made in exercise of the powers conferred by section 24 of the Act what are called the Punjab Industrial Housing, Chandigarh (First Amendment) Rules, 1972 adding the fol lowing, ,after sub rule (2) in Rule 4 of the Rules: 330 "(3) An industrial worker shall become ineligible to retain the industrial house allotted to him from the date his income exceeds Rs. 350/ per mensem and his allotment of it shall stand cancelled with effect from that date.
Provided that in case such an industrial worker has been allotted and is in occupation, of an industrial house immediately before the commencement of the Punjab Industrial Hous ing (Chandigarh First Amendment) Rules, 1972, his allotment shall be cancelled by the Labour Commissioner after giving him one month 'S notice in writing of such cancella tion.
Chief Commissioner also ordained that the following shall be added in form 'C ' of the Rules after condition (24) : "(25) The allottee shall become ineligible to retain the industrial house, allotted to him from the date his income exceeds rupees 350 per mensem and his allotment shall be deemed to have been cancelled from that date.
" The appellants and the aforesaid respondents, who were allottees of houses in Sector 30, Chandigarh constructed by the State Government for occupation of industrial workers under the Industrial Housing Scheme subsidised by the Central Government and declared under section 3 (2) of the Act to be houses covered by the provisions of the Act were given notices.
by the Labour Inspector, Union Territory, Chandigarh, in terms of the proviso to sub rule (3) of rule 4 of the Rules, as amended by the aforesaid Notification No. 74804H(8) 72/21542 dated November 7, 1972, calling upon them to show cause as to why the allotment of houses made to them should not be cancelled as the income of each one of them exceeded Rs. 350/ per mensem which disentitled them to retain their respective allotments.
The appellants and the aforesaid respondents thereupon filed a joint writ petition, being writ petition No. 1819 of 1975 under Arti cles 226 and 227 of the Constitution in .the
High Court of Punjab and Haryana for issue of an appropriate writ, order or direction quashing the said notices and notification No. 7480 4H(8) 72/21542 dated November 7, 1972 amending Rule 4 of the Rules and restraining respondents 1 and 2 from pro ceeding with the cancellation of their respective allotments and evicting them from the houses.
They contended that the aforesaid rule 4 as amended was ultra vires the Act in so far as it carved out an exception to the statutory defini tion of "industrial worker ' as contained in section 2(e) of the Act within the scope of which they admittedly fell.
The High Court repelled their contention and dismissed their writ petition by its judgment dated April 28, 1975.
Ag grieved by this judgment and order, the appellants and the said respondents made an application to the High Court for issue of a certificate of fitness under Article 133 of the Constitution which was refused by the High Court by its order dated May 9, 1975.
Thereupon they moved this Court for special leave under Article 136 of the Constitution which was granted.
331 Appearing in support of the appeal, Mr. Ramamurthy has reiterated before us that since the appellants and respond ents 3 to 37 are admittedly industrial workers as defined in clause (e) of section 2 of the Act, the impugned rule 4 which is designed to cancel their allotment, on the ground that their salary exceeded Rs. 350/ per mensem is clearly repugnant to that clause and as such utra vires and invalid as it takes out industrial workers with income exceeding Rs. 350/per mensem from the scope of the definition.
He has further contended that since the authority competent to make rules under section 24 of the Act cannot frame any rule having a retrospective effect and the impugned rule rule 4(3) as amended operates retrospectively, the same is in valid.
He has lastly urged that the impugned notification is also invalid as if makes hostile and arbitrary discrimi nation against industrial workers whose income exceeds Rs. 350/ per mensem, and thereby violates the guarantee en shrined in Article 14 of the Constitution.
We shall deal seriatim with all the three contentions raised by Mr. Ramamurthy.
Before embarking on that task, we consider it appropriate to scan the scheme of the Act.
Section 3 of the Act clearly states that the Act shall be applicable to houses constructed by the State Government for the occupation of industrial workers under the Industrial Housing Scheme subsidised by the Central Government.
The scheme, as evident from the affidavit of the Home Secre tary, Chandigarh Government, is meant for the benefit of the low aid industrial workers and economically weaker sections of the community.
Section 9(1) of the Act provides that the occupation by any person of a house shall at all times be subject to such conditions relating to its occupation as may be prescribed, or as may be intimated from time to time by the Labour Commissioner.
Section 7 of the Act sets out the circumstances in which a person shall be treated to be in unauthorised occupation of any house.
Clause (b) of the section explicity states that a person shall be deemed to be in unauthorised occupation "Where being an allottee he has by reason of cancellation of an allotment under sub sec tion (2) of section 9 ceased to be entitled to occupy the house".
Sub section (2) of section 9, which is necessary to be referred to at this stage and which because of the non obstante clause contained in its opening part overrides all other laws for the time being in force, authorises the Labour Commissioner after giving notice to the allottee and considering the explanation tendered by him to cancel the allotment under which a house is held or occupied by him.
Section 24 of the Act not only empowers the State Government generally to make rules to effectuate the purposes of the Act but also specifically confers on it the power to make rules to provide inter alia for the manner of allotment of accommodation and conditions relating to its occupation [see section 24(2)(ii)] as also for the matters which are to be or may be prescribed [see section 24(2)(x)].
A conspectus of the aforesaid provisions of the Act leaves no room for doubt that the allotment of accommodation to an industrial worker is not unconditional but is subject to conditions which can be changed unilaterally by the Government from time to time by altering the rules in exercise of the powers conferred on it 331(a) under section 24 of the Act.
Section 7 of the Act which embodies a deeming provision gives a mandate to treat a person as an unauthorised occupant not only if he ceases to be an industrial worker under the Act but also if being an allottee, he ceases to.be entitled to occupy the accommoda tion by reason of cancellation of the allotment under sub section (2) of section 9 of the Act.
A combined reading of sections 7 and 9 of the Act goes to show that if at any time a person becomes an unauthorised occupant of the house by reason of his ceasing to be an industrial worker or by otherwise ceasing to fulfil any of the prescribed conditions then in force including the one relating to the limit of his income, he becomes amenable to action under section 9(2) of the Act.
The result is that even though the allottee may continue to be an industrial worker, still the allotment under which he holds a house can be cancelled if his occupa tion becomes un authorised on any one of the grounds laid down in section 7 of the Act.
We are, therefore, satis fied that the impugned amendment which squarely falls within the purview of the aforesaid provisions of section 24 of the Act was validly made and the contention urged by Mr. Rama murthy that it is ultra vires is misconceived and untenable.
We may state here in passing that the aforesaid scheme being meant for the benefit of the low paid industrial workers and the number of the houses constructed thereunder being very limited, the Government could legitimately evolve the method which it did to disentitle industrial workers like the appellants whose monthly salaries appear to range between Rs. 974.71 and Rs. 1861.27 and the aforesaid respondents whose monthly income is also relatively large to retain the houses in question.
The contention of Mr. Ramamurthi that the impugned rule is retroactive in operation is also devoid of merit.
A careful study of the proviso to rule 4(3) of the Rules which appears to have been inserted to allay fears and remove misapprehensions would show that the rule is not intended to operate retrospectively on industrial workers who had been allotted and were in occupation of industrial houses immedi ately before the amendment of the Punjab Industrial Housing (Chandigarh First Amendment) Rules, 1972.
It une quivocally states that allotment of an industrial worker who is in occupation of an industrial house in pursuance thereof immediately before the amendment of the Punjab Industrial Housing (Chandigarh First Amendment) Rules, 1972 shall not be cancelled without one month 's notice in writing.
The proviso therefore clearly shows that the allotment of an in dustrial worker whose income exceeds Rs. 350/ per mensem is to stand cancelled not from the date when his income started exceeding Rs. 350/ per mensem but on the expiry of one month 's notice in writing of the cancellation.
The second contention raised by Mr. Ramamurthi is also, therefore, repelled.
The third contention advanced by the learned counsel on behalf of the appellants not having been raised before the High Court cannot be permitted to be raised at this stage.
The contention can also not be allowed to be raised in view of the Presidential Order dated June 27, 331(b) 1975 promulgated under clause (1) of article 359 of the Consti tution suspending inter alia Article 14 of the Constitution for the period during which the proclamation of emergency made under clause (I ) of Article 352 of the Constitution on December 3, 1971 and on June 25, 1975 are both in force.
For the foregoing reasons, we do not find any merit in this appeal which is dismissed but in the circumstances of the case without any order as to costs.
Counsel for the appellants submits that he may be given time for vacating the premises.
We grant time till 31st August 1977 on the undertaking given by the counsel that vacant possession will be given on or before that date.
M.R. Appeal dismissed.

summary/full:
The appellants and respondents Nos. 3 to 37 herein, were allottees of houses in Chandigarh constructed by the State Government for low paid industrial workers under the Industrial Housing Scheme subsidised by the Central Govern ment.
The Labour Inspector, Union Territory, Chandigarh gave them notices in terms of the proviso to, rule 4(3) of the Punjab Industrial Housing Rules, 1956, as amended vide Notification dated November 7, 1972, to.
show cause why their allotments should not be cancelled.
The income of each of them exceeded Rs. 350/ per mensem, which disenti tled them to retain their allotments.
The appellants and the said respondents filed a joint petition in the High Court for a writ to quash the amendment to rule 4, and to restrain the Government from cancelling their allotments and evicting them.
The writ petition was dismissed.
The appel lants contended firstly, that rule 4(3) was ultra vires the Punjab Industrial Housing Act, 1956 as it took out industri al workers with income exceeding Rs. 350/ p.m. from the scope of section 2(e) of the Act which defines industrial workers; and secondly, that the authority competent to make rules u/s 24 of the Act cannot frame rules having retrospec tive effect, and as the amended rule 4(3) operates retro spectively it is invalid Dismissing the appeal by special leave, the Court, HELD: (1) The allotment of accommodation to an industrial worker is not unconditional but is subject to conditions which can be changed unilaterally by the Government from time to time by altering the rules in exercise of the powers conferred on it under section 24 of the Act.
Section 24 specifically empowers the State Government to make rules to provide inter alia for the manner of allotment of accom modation and conditions relating to its occupation.
The impugned amendment which squarely falls within the purview of the aforesaid provisions of section 24, was validly made, and was not ultra vires.
[331 G H, 331 (a) C] (2) Section 7 of the Act embodies a deeming provision and gives a mandate to treat a person as an unauthorised occupant not only if he ceases to be an industrial worker under the Act, but also if being an allottee, he ceases to fulfil any of the prescribed conditions then in force, including the one relating to the limit of his income, and thereby becomes amenable to action under section 9(2) of the Act.
[331(a) A B] (3) The proviso to rule 4(3) clearly shows that the allotment of an industrial worker whose income exceeds Rs. 350/ per mensem is to stand cancelled not from the date when his income started exceeding Rs. 350/ per mensem but on the expiry of one month 's notice in writing of the can cellation.
The rule is not intended to operate retrospec tively on industrial workers who had been allotted and were in occupation of industrial houses immediately before, 328 the amendment of the Punjab Industrial Housing (Chandigarh First Amendment) Rules, 1972.
[331(a) E F] The Court observed The scheme being meant for the benefit of the low paid industrial workers and the number of the houses constructed thereunder being very limited, the Government could legiti mately evolve the method which it did, to disentitle indus trial workers whose monthly income was relatively large, to retain the houses.
[331 (a) C D]


judgement:
Appeal No. 81 of 1977.
(Appeal by Special Leave from the judgment and order dated 6 12 1976 of the Delhi High Court in C.R. No. 248/76).
F.S. Nariman, N.S. Sistani and K.C. Dua for the appellant.
K.K. Jain, S.K. Jain and P. Dayal, for respondent No. 1.
314 The Judgment of the Court was delivered by KRISHNA lYER, J.
Delhi, the home of Power and the nidus of paradoxes, presents many pathological problems to the students of history, social science, politics and law, often inter acting with each other.
We are here concerned with the socio legal malady of accommodation scarcity and the syndrome of long queues of government employees waiting, not knowing for how long, for allotment of government quar ters at moderate rents and the co existence of several well to do officers enjoying, by virtue of their office, State allotted residential accommodation while owning their own but letting them out at lucrative rents, making sub stantial incomes in the bargain.
The law awoke to end this unhappy development and to help the helpless nonallottees get government accommodation.
Such is the back drop to section 14A which, read along with section 25B, of the Delhi Rent Control Act, 1958 (Act LIX of 1958) (for short, the Act), falls for our consideration in the present appeal by special leave.
A deeper understanding of the need for the new provi sions just mentioned and the construction that they bear in the context necessitates stating a little more in detail the social setting.
The seat of the capital of a vast country with varied activities naturally will be honeycombed with government offices, public organisations and growing armies of employees.
The higher echelons in public service, over the decades, have made generous use of the availability of government lands at low prices and of the know how of utilising, to their advantage, the immense developmental potential in the years ahead if buildings were constructed with foresight.
Thus many neatly organised colonies blossomed all around Delhi whose owners were in many in stances officers who had the telescopic faculty to see the prospective spread out of Delhi of the future.
Taking time by the forelock, they wisely invested money (often on soft loans from Government) in buildings which secured ambi tious rents when India 's headquarters did, as it was bound to, explosively expand.
Most of such officials let their premises for high rents to big businessmen, foreign estab lishments, company executives and others of their link.
Where did the officers themselves reside ? The strange advantage of Delhi is that houses, with lawns, servants ' quarters and other amenities, built by government long years back are allotted to government servants on rents which are a fraction of what similar accommodation in the private sector may fetch oftentimes.
The bigger officials according to the hierarchical system (almost perfected into some sort of official castes and sub castes based on status and position in the ministries and not on the heads of their families or office) occupied the classified quar ters, the official `brahmins ', of course, getting the best.
The rents they paid as tenants were negligible compared to the returns they made as landlords.
Indeed, a sociological research into the whole system may perhaps unravel the semi survival of quasifeudal life styles and the unlovely phenomenon of public servants paying little and collect ing large.
The socio economic sequel was worse than this.
An astronomical increase in the number of government servants led to a terrific pressure for accommodation because, most of them particUlarly at the lesser 315 (Krishna lyer, J.) levels had no worthwhile salaries and were priced out of the private sector where rentals had unconscionably rocket ed.
This rack renting abuse can be checked, in some meas ure, by an activist policy of relentlessly enforcing fair rents through penal tags.
That, of course, depends on the will and wisdom of Parliament and Government, and the court may not make any comment.
Anyway, currently, controls in this essential area of human accommodation, in the capital city of our socialist republic, are a statute book virtue.
Similarly, the suggestion, in the course of his submissions, made by counsel for the appellants, that the true solution is for the State to build more accommoda tion for its servants and not eject tenants like his client is commendable as a text book panacea but `a consum mation to be wished ' in practical expectations! Nevertheless, the State took cognizance of the sinister development of several officers owning private residences and occupying government premises and making handsome dividends out of the disparity in rents and, ergo, a large number of less fortunate officials having to wait in a queue for years hoping against hope that some day some government quarters would be allotted! These latter, with broken domestic budgets, huddle together in small private tenements (or even servants ' quarters) paying rents beyond their means.
The politics and economics of scarcity are well known.
Out of this distressing situation was born section 14A of the Act.
A fasciculus of clauses creating substantive and procedur al provisions to meet the evil and advance the scheme in that behalf came in, first by ordinance 24 of 1975 in Decem ber 1975, duly replaced by the Delhi Rent Control (Amend ment) Act, 18 of 1976.
The chronic disease needed dras tic treatment and the legislative draftsmen created a chain of stiff provisions.
Speaking generally, the government, after satisfying itself about the official having let out his residential building and occupying officially allotted quarters, directed the person to vacate government premises but he had quickly to get back his own house.
So a new right (section 14A) was created,accelerated remedial procedures were prescribed (section 25A and 25B).This appeal turns on the meaning of section 14A. The purpose of the project has been explained by Chandrachud J. in Sarwan Singh(1): "The object of Section 14A, as shown by its marginal note, is to confer a right on certain landlords to recover immediate possession of premises belonging to them and which are in the possession of their tenants.
In the sig nificant language of the marginal note, such a right is `to accrue ' to a class of persons.
The same concept is pursued and clarified in the body of Section 14A by providing that in the contingencies mentioned in the section, a right will accrue to the landlord 'to recover immediately possession of any premises let out by him '. " * * * * "Whatever be the merits of that philoso phy, the theory is that an allottee from Central Government or a local (1) Sarwan Singh vs Kasturi Lal, ; , 272 274.
316 authority should not be at the mercy of law 's delays while being faced with instant eviction by his landlord save on payment of what in practice is penal rent.
Faced with a Hob son 's choice, to quit the official residence or pay the market rent for it, the allottee had in turn to be afforded a quick and expedi tious remedy against his own tenant.
With that end in view it was provided that nothing, not even the Slum Clearance Act, shall stand in the way of the allottee from evicting his tenant by resorting to the summary procedure prescribed by Chapter IIIA.
The tenant is even deprived of the elementary right of a defendant to defend a proceeding brought against him, save on obtaining leave of the Rent Controller.
If the leave is refused, by section 25B(4) the statement made by the landlord in the application for eviction shall be deemed to be admitted by the tenant and the landlord is entitled to an order for eviction.
No appeal or second appeal lies against that order.
Section 25B(8) denies that right and provides instead for a revision to the High Court whose jurisdiction is limit ed to finding out whether the order complained of is according to law.
" It is a notorious fact that, vesting a right is long years ' distance away from getting the remedy, thanks to our legal process with its slow motion mood.
A jurisprudence of quick acting and comprehensive remedies, demanding re structuring and streamlining of the judicative apparatus and imparting operational speed and modernisation of the whole adjectival law and practice, is urgent and important an observation we make hoping that Parliament will programme for such a constructive change for the good of the communi ty, in consultation with the Court and the Bar.
That legal instrumentality alone truly sustains the rule of law which delivers justice with inexpensive colority, finality and fullness.
The big right remedy gap is the bane of our system.
We regard it our duty to, mention this dimension of justice and this desideratum of systemic reform so that repetitive litanies to end law 's delays may be intelligently heeded by the law makers instead of joining the chorus against the court.
Back to the statute.
Section 14 A, with a non obstante rider, follows upon and is partly supplemental to section 14 which primarily governs eviction by landlords of tenants.
We may extract a part of section 14 and the whole of section 14A: "14(1) Notwithstanding anything to the contrary in any other law or contract, no order or decree for the recovery of possession of any premises= shall be made by any court or Controller in favour of the landlord against a tenant: Provided that the Controller may, on an application made to him in the prescribed manner make an order for the recovery of possession of the premises on one or more of the following grounds only, namely, (a) to (d) * * * * 317 (Krishna Iyer, J.) (e) that the premises let for residential purposes are required bona fide by the land lord for occupation as a residence for himself or for any member of his family dependent on him, if he is the owner thereof, or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable residential accom modation: Explanation.
For the purposes of this clause, "premises let for residential pur poses, includes.
any premises which having been let for use as a residence are, without the consent of the landlord, used incidental ly fo.r commercial or other purposes, . " X X X X "14A. Right to recover immediate posses sion of premises to accrue to certain persons. (1) Where a landlord who, being a person in occupation any residential premises allotted to him by the Central Government or any local authority is required, by, or in pursuance of any general or special order made by that Government or authority, to vacate such resi dential accommodation, or in default, to incur certain obligations, on the ground that he owns, in the union territory of Delhi, a residential accommodation either in his own name or in the name of his wife or dependent child, there shall accrue, on and from the date of such order, to such landlord, notwith standing anything contained elsewhere in this Act or in any other law for the time being in force or in any contract (whether express or implied), custom or usage to the contrary, a right to recover immediately possession of any premises let out by him: Provided that nothing in this section shall be construed as conferring a right on a landlord owning, in the union territory of Delhi two or more dwelling houses, whether in his own name or in the name of his wife or dependent child, to recover the possession of more than one dwelling house and it shall be lawful for such landlord to indicate the dwelling house, possession of which he intends to recover.
(2) Notwithstanding anything contained elsewhere in this Act or in any other law for the. time being in force or in any contract, custom or usage to the contrary, where the landlord exercises the right of recovery conferred on him by sub section (1 ), no compensation shall be payable by him to the tenant or any person claiming through or under him and no claim for such compensation shall be entertained by any court, tribunal or other authority: Provided that where the landlord had received, 318 (a) any rent in advance from the tenant, he shall, within a period of ninety days from the date of recovery of possession of the premises by him, refund to the tenant such amount as represents the rent payable for the unexpired portion of the contract, agreement or lease; (b) any other payment, he shall, within the period aforesaid, refund to the tenant a sum which shall bear the same proportion to the total amount so received, as the unexpired portion of the contract or agreement, or lease bears to the total period of contract or agreement or lease; ' Provided further that, if any default is made in making any refund as aforesaid, the landlord shall be liable to pay simple inter est at the rate of six per cent per annum on the amount which he has omitted, or failed to refund." A summary remedy is provided by section 25B which reads: "25.B. Special procedure for the disposal of applications for eviction on the ground of bona fide requirement. (1) Every application by a landlord for the recovery of possession of any premises on the ground specified in clause (a) of the proviso to.
sub section (1) of Section 14, or under Section 14A, shall be dealt with in accordance with the procedure specified in this section.
(2) The ContrOller shall issue summons, in relation to.
every application referred to in sub section (1 ), in the form specified in the Third Schedule.
(3) (a) The Controller shall, in acquisi tion to, and simultaneously with, the issue of summons for service on the tenant, also direct the summons to be served by registered post, acknowledgment due, addressed to the tenant or his agent empowered to accept the service at the place where the tenant or his agent actu ally and voluntarily resides or carries on business or personally works for gain and may, if the circumstances of the case so require, also direct the publication of the summons in a newspaper circulating in the locality in which the tenant is last known to have resided or carried on business or personally worked for gain.
(b) When an acknowledgment purporting to be signed by the tenant or his agent is re ceived by the Controller or the registered article containing the summons is received back with an endorsement purporting to have been made by a postal employee to the effect that the tenant or his agent had refused to take delivery of the registered article, the Controller may declare that there has been a valid service of summons.
319 (Krishna Iyer, J.) (4) The tenant on whom the summons is dully served (whether in the ordinary way or by registered post) in the form specified in the Third Schedule shall not contest the prayer for eviction from the premises unless he files an affidavit stating the grounds on which he seeks to contest the application for eviction and obtains leave from the Controller as hereinafter provided; and in default of his appearance in pursuance of the summons or his obtaining such leave, the statement made by the landlord in the application for eviction shall be deemed to be committed by the tenant and the applicant shall be entitled to an order for eviction on the ground aforesaid.
(5) The Controller shall give to.
the tenant leave to contest the application if the affidavit filed by the tenant discloses such facts as would disentitle the landlord from obtaining an order for the recovery of possession of the premises on the ground specified in clause (a) of the proviso to sub section (1) of Section 14, or under Sec tion 14A. (6) Where leave is granted to the tenant to contest the application, the Controller shall commence the hearing of the application as early as practicable.
(7) Notwithstanding anything contained in sub section (2) of Section 17, the Controller shall, while holding an inquiry in a proceed ing to which this Chapter applies, follow the practice and procedure of a Court of Small Causes, including the recording of evidence.
(8) No appeal or second appeal shall lie against an order for the recovery of posses sion of any premises made by the Controller in accordance with the procedure specified in this section; Provided that the High Court may, for the purpose of satisfying itself that an order made by the Controller under this section is according to law, call for the records of the case and pass such order in respect thereto as it thinks fit.
(9) Where no application has been made to the High Court on revision, the Controller may exercise the powers of review in accordance with the provisions of Order XL VIX of the first Schedule to the Code of Civil Procedure, 1908 (5 of 1908).
(10) Save as otherwise provided in this Chapter, the procedure for the disposal of an application for eviction on the ground speci fied in clause (e) of the proviso to subsec tion (1) of Section 14, or under Section 14A, shall be the same as the procedure for the disposal of applications by Controllers.
" 320 The landlord respondent No. 1 was a government servant who had let his own building to the .appellant tenant (a company) to carry on business and use part of it for its manager 's residence.
He himself was occupying residential premises allotted by the Central Government and, since he was directed by that Government to vacate, on the ground that he had let out 'residential accommodation ' of which he was owner, he sought refuge under section 14A.
The eviction proceeding was resisted, inter alia, on the score that the ground did not fail within the sweep of section 14A, the premises 'having been let out for a residential cum commercial pur pose to a joint stock company which was carrying on its business . besides using it for the residence of its Managing Director '.
This plea did not cut ice with the Controller who refused leave to contest under section 25B(4).
of the Act.
The refusal would ordinarily have led to an order for eviction but this consequence was intercepted by a writ petition under article 226 of the Constitution and a revision to the High Court, as provided by the proviso to subs.
(8) of section 25B of the Act.
Dismissal of these proceedings has brought the appellant, special leave having been granted, to this Court as the last hope.
Of course, the issue is of some moment, legally and otherwise.
For while solving the twin problems, viz. making more accommodation available to government servants in need and ending the vice of officers gaining by letting their own residential houses, section 14A creates another, viz., the ejectment of tenants by summary procedure on a new ground.
Maybe, as between the two.
hardships Parliament has made the choice and the Court implements the law based on the policy decision of the legislature.
Mr. Nariman sought to expose the weakness of this legislative, policy by stating that nothing in section 14A compelled the officer landlord to occupy the premises after evicting the tenant.
He could still let it for a higher rent, take on lease from the private sector a small house and make a gain flowing from the difference in rents.
While we, as Judges, cannot fail to apply the provision merely because dubious ingenuities can circumvent it, we will later interpret the section eliminating the possible evil pointed out.
The short but insistent submission made by the counsel for the appellant was that the Controller could not shut him out from being heard, as he did, if only a triable issue emerged from the affidavit in opposition filed under 'section 25B(4).
Such an issue (in fact, more than one) was obviously present here, urged counsel.
But we make it plain even at this stage that it is fallacious to approximate (as was sought to be done) section 25B(5) with Order 37, r. 3 of the Code of Civil Procedure.
The social setting demanding summary proceeding, the nature of the subject matter and, above all, the legis lative diction which has been deliberately designed, differ in the two provisions.
The legal ambit and judicial dis cretion are wider in the latter while, in the former with which we are concerned, the scope for opening the door to defence is narrowed down by the strict words used.
The Controller 's power to give leave to contest is cribbed by the condition that the affidavit filed by the tenant dis closes such facts as would disentitle the landlord from obtaining an order for the recovery of posession of the premises on the ground specified in cl.
(e) of the proviso to sub section
(1) of section 14 321 (Krishna lyer, J.) or under section 14A. Disclosure of facts which disentitle recovery of possession is a sine qua non for grant of leave.
Are there facts disentitling the invocation of section 14A ? The thrust of Shri Nariman 's contention is that section 14A does not apply at all, as a matter of construction of the expression 'residential premises '.
This is net something factual but essentially legal and perhaps the question deserves our decision.
For, if we explain, as declaratory of the law, what the true scope of section 14A is, vis a vis the premises involved, the Controller may then proceed on that footing and decide whether there is any fact disclosed which disentitles eviction.
Let us break down section 14A, to the basic components crea tive of the new right to recover possession of premises let to a tenant.
`Premises ', by definition, covers any building or part of a building let for use, residential, commercial or other (section 2(i)).
We confine ourselves to the considera tions relevant to our case.
To attract section 14A, the landlord must be in occupation of `residential premises ' allotted to him by the Central Government.
He must be required by order of that Government to vacate such 'residential accommoda tion '.
These are fulfilled here.
The ground for such order to vacate must be 'that he owns, in the Union Territory of Delhi, a residential accommodation '.
If so, there accures to such landlord the right 'to recover immediately posses sion of any premises let out by him ' (emphasis added).
The bone of contention between the parties is as to whether the premises let out are 'residential accommoda tion '.
It may be a pursuit of subtle nicety to chase the reason for using different expressions like 'residential premises ' and 'residential accommodation ' in the same sec tion.
If at all, 'accommodation ' is ampler than 'premises '.
What is residential accommodation ? If the building in dispute answers that description, the tenant must submit to eviction.
So this is the key question.
Admittedly, the building was let out for commercial purpose also.
Is the purpose of the lease decisive of the character of the accommodation ? For a long time it was used as an office of the tenant 's business, the manager also residing in a part thereof.
Does user clinch the issue ? At present, the main use to which the building is put is as residence of the manager.
The Delhi Development Authority granted the land to the government servant respondent for construction of a residen tial building although he later let it out for non residen tial use, apparently for getting large rents, silencing his compunction about the basis on which he secured the allot ment of the land at low cost.
But can the court conclude from the object of the land assignment whether the building later put up is residential or not ? Marginal relevance there may be in these diverse factors, telling value they do not possess, Law, being 6 436SCI/77 322 pragmatic, responds to the purpose for which it is made, cognises the current capabilities of technology and life style of the community and flexibly fulfils the normative role, taking the conspectus of circumstances in ,the given case and the nature of the problem to solve which the stat ute was made.
LegiSlative futility is to be ruled out so long as interpretative possibility permits.
Residentiality depends for its sense on the context and purpose of the statute and the project promoted.
Guided by this project oriented approach, we reject the rival extreme position 's urged before us by Shri Nariman and Shri Jain.
Residential premises are not only these which are let out for residential purposes as the appellant would have it.
Nor do they cover all kinds of structures where humans may manage to dwell.
If a beautiful bungalow were let out to a businessman to run a show room or to a meditation group or music society for meditational or musical uses, it re mains none the less a residential accommodation.
Otherwise, premises may one day be residential, another day commercial and, on yet a later day, religious.
Use or purpose of the letting is no conclusive test.
Likewise, the fact that many poor persons may sleep under bridges or live in large hume pipes or crawl into verandahs of shops and bazars cannot make them residential premises.
That is a case of reductio ad absurdum.
Engineering skills and architectural designing have advanced far enough to make multi purpose edifices and, by minor adaptations, make a building serve a residential, commercial or other use.
The art of building is no longer ' rigid and the character of a house is not an 'either or '.
It can be both, as needs demand.
It is so common to see a rich home turned into a business house, a dormitory into a factory.
Many small scale industries are run in former living quarters.
To petrify engineering concepts is to betray the law 's purpose.
Whatever is suitable or adaptable for residential uses, even by making some changes, can be designated 'residential premises '.
And once it is 'residen tial ' in the liberal sense, section 14A stands attracted.
Dic tionary meaning, commonsense understanding and architectur al engineering concur in the correctness of this construc tion.
What falls outside the ambit of 'residential purposes ' may be limited but not non existent.
A shop in Connaught Place, a factory in an area prescribed by any municipal regulation for residential use or any structure too patently non residential such as a hothouse for botanical purposes or a bath and toilette or teashop by the road margin are obvi ous instances.
We may visualise other cases but that is not our purpose here.
The house we are considering was built on land given for constructing a residence is being used even now for residence, is suitable otherwise for residence and is being credibly demanded for the respondent 's residence.
Residential suitability being the basic consideration, this building fills the bill.
Nothing said in the affidavit in opposition puts it out of the pale of residential accommoda tion.
A building which reasonably accommodates a residen 323 (Krishna Iyer, J.) tial user is a residential accommodation nothing less, nothing else.
The circumstances of the landlord are not altogether out of place in reaching a right judgment.
The 'purpose test ' will enable officers who own houses to defeat the government by pleading that they do not own 'residential premises ' because the lease is for commercial use, built though it was and stumble ,though it is, for residence.
Similarly, the 'possibility test ' may make nonsense of the provision.
The contrast in the phraseology between section 14(1)(e) and section 14A strengthens our inference.
The legislature has, in the former provision, used the expression 'premises let for residential purposes ', thus investing the purpose of the lease with special signifi cance.
The deliberate omission of such words in section 14A and, instead, the use of the flexible but potentially more com prehensive, though cryptic, expression 'residential accom modation ' cannot be dismissed as accidental.
Shri Nariman argued that the court must have the power to consider whether the order of the government stating that the government servant 's building is residential, is valid or not.
We do not deny that in the last resort it is within the Court 's province to do so.
But it must give due not deadly weight to the decision of the government that the premises owned by its officer is residential.
Perversity and mala fides will, of course, invalidate government orders here, as elsewhere.
They are the exceptions but as a prac tical guideline, the government 's order may be taken as correct.
For, after all, while courts must finally pro nounce, others familiar with the work a day world and en quire before passing orders are not too inexpert or incompe tent to be brushed aside.
The power to render binding decisions vests in the judicial process, not because it is infallible or occult but because it is habitually independ ent and professionally trained to consider contending view points aided by counsel for a adversaries.
The humility that makes for wisdom behoves the judge to show respect for not obedience to the view of an administrative agency.
There remains the conundrum raised by Shri Nariman.
Supposing the landlord, after exploiting the easy process of section 14A, re lets the premises for a higher rent; the social goal boomerangs because the tenant is ejected and the landlord does not occupy, as he would have been bound to do, if he had sought eviction for bona fide occupation under section 141(e).
Section 19 obligates the landlord in this behalf.
In literal terms, that section does not apply to eviction obtained under section 14A.
But the scheme of that section definitely contemplates a specific representation by the petitioner landlord to the Controller that because he has been ordered to vacate the premises where he is residing, therefore he requires immediate possession for his occupa tion.
The non obstante clause, the vesting of a right to immediate recovery, the creation of a summary process under section 25B and the package of connected provisions, all empha size that the amendments have to be viewed as a whole, that the Court cannot be fooled and the statute mocked at.
The law, as Mr. Bumble (in Oliver Twist) said.
`is a ass a idiot ', but today the socio economic project cannot be frustrated by legalistics.
Underlying the whole legislative plan and provision is the fundamental anxiety to recover, for the officer 's occupation, his own premises.
Once we grasp this cardinal point, the 324 officer 's application for eviction under section 14A can be entertained only on his averment that he, having been asked to vacate, must get into possession of his own.
For in stance, if he has a vacant house of his own and, on getting an order to vacate, he moves into his vacant house, he cannot thereafter demand recovery under section 14A.
The cause of action is not only the government order to vacate, but his consequential urgency to recover his own building.
That is the rationale legis.
To interpret otherwise is to vindicate Mr. Bumble ! We hold that Shri Nariman 's apprehen sion is unfounded and section 14A is largely a rider to .s.
14 and the condition indicated in section 19 must, mutatis mutandis, bind the landlord.
Parliament cannot be assumed not to intend the obviouS, or to intend the ludicrous.
Literality not right where absurdity is the result.
The same result is reached by reading into every appli cation for eviction by a landlord a necessarily implied representation to court that for the reason of his being directed to get out he must be given possession of his own residence for his own occupation with the aid of the judi cial process.
If the finale is reached and possession obtained, the Court will not allow a party to reduce its process to a mere make .
believe, or a clever parody, break ing faith with the judicial process itself.
Such paths can be interdicted by the use of the inherent power of the court.
The re letting to someone else or non occupation, even after a reasonable time or without reasonable cause, will be regarded as an abuse of the process of the court and, at the instance of the affected tenant or otherwise, the eviction order cancelled and possession restored.
We affirm this legal position lest overly cute but qualmless landlords should hopefully hoax the court and reduce its decree to a joke.
Every tribunal has the inherent power to prevent its machinery from being made a sham, thereby run ning down the rule of law itself as an object of public ridicule.
It will and must prove any strategem self defeat ing if a party indulges in making the law the laughing stock, for, the court will call him to order.
We are not adventuring into any innovation of legal principle in inhibiting unconscionability in the enforce ment of rights.
Lord Denning M.R. said: "What is the justification for the courts in this or any other case, departing from the ordinary meaning of words ? If you examine all the cases you will, I think, find that at bottom it.is because the clause (relieving a man from his own negligence) is unreasonable or is being applied unreasonably in the cir cumstances of the particular case.
The judges have then, time after time, sanctioned a departure from the ordinary meaning .
Are the courts then powerless ? Are they to permit the party to enforce his unreasonable clause, even when it is unconscionable, or applied so unreasonably as to be unconscion able ? When it gets to this point, I would say, as I said many years ago: `There is the vigilance of the common law which, while allowing freedom of contract, watches to see that it is not abused. '" X X X X 325 (Krishna Iyer, J.) He continued: "I know that the judges hitherto have never confessed openly to the test of reasona bleness.
But it has been the driving force behind many of the decisions.
"(1) We agree that, in the words of Lord Erakine, 'there is no branch of the jurisdiction of this court more delicate than that, which goes to restrain the exercise of a legal right '.
But the principle of unconscionability clothes the court with the power to prevent its proc ess being rendered a parody.
The justice of the law steps in end, the area of eviction of a tenant by a landlord, the tribunal cannot tolerate double dealing or thwarting the real in tendment of the statute.
The same conclusion can be reached through another line of reasoning expressed by Justice Jackson of the Supreme Court of the United States in D ' Cench Duhme:(2) "If the judicial power is helpless to protect a legislative program from schemes for easy avoidance, then indeed it has become a handy implement of high finance .
Once the purpose or effect of the scheme is clear, once the legislative policy is plain, we would indeed forsake a great tradition to any we were helpless to fashion the instruments for appropriate relief.
" The doctrine that the judicial machinery, while enforc ing the law, shall forbid its being misused is another dimension of two deeply rooted, but inter connected maxims.
Actus curiae neminem gravabit (An act of the court shall prejudice no man: Jenk.
118) and Actus legis est damnosus (The act of the law is hurtful to no one: 2 Inst. 287): Actus legis nemini facit in juriam (The act of the law does injury to no one: 5 Coke.
This principle is fundamental to any system of justice and applies to our jurisprudence.
An Afterword The possibility of the power of government to issue orders to vacate being used discriminatorily should be carefully avoided.
If exceptions are made in the case of big officers, naturally the middling and the lesser minions of government may have a grievance.
It may perhaps be proper if government, when allotting good premises for high offi cers who make from their own houses large returns by way of rentals, makes them pay into government coffers some equita ble part of the gain so made, giving consideration to cir cumstances like loans, investments and the like.
This, again, is a matter falling with (1) 39 Mod.
L.R. 379 (1976) (2) Referred to in , at 366 67; Quoted in Univ.
of Pennsylvania Law Review VoL. 117 (1968) p. 1, 63.
326 in the province of the sense of justice of the Administra tion.
But we mention it only to save the legislation from the aspersion of invidiousness in the exercise of the power.
In the view we have already taken, it follows that the appeal must be dismissed and we hereby do so; but the par ties, in the circumstances, will bear their own costs throughout.
P.H.P. Appeal dismissed.

dataset_name: IN-Abs

summary/full:
The respondent No. 1 landlord let out his building to the appellant, a company to carry on business and use part of it for its manager 's residence.
The landlord was occupying residential premises allotted by the Central Government.
After the amendment of the.
Delhi Rent Control Act, 1958, by Ordinance 24 of 1975 which was later replaced by Delhi Rent Control (Amendment) Act, 1976, section 14A and 25B were added to the Statute.
Section 14 permits a landlord to evict the tenant if the premises let for residential pur pose are required bonafide by the landlord for occupation as a residence for himself or for any member of his family dependent upon him.
Section 14A provides that where a landlord is in occupation of any residential accommodation ,allotted to him by the Central Government or any local authority and if he is required by order made by that Gov ernment or authority to vacate such residential accommoda tion on the ground that he owns in the Union Territory of Delhi a residential accommodation either in his own name or in the name of his wife or dependent child, there shall accrue to the landlord a right to recover immediately pos session of any premises let out by him.
The said provision has been given effect notwithstanding anything to the con trary in the Delhi Rent Act or any other law or the custom or usage.
Section 25B provides for a summary remedy.
It provides that the Controller shall give to the tenant leave to contest the application if the affidavit filed by the tenant discloses such facts as would disentitle the landlord for obtaining an order for the recovery of possession on the ground specified in section 4(1)(c) or 14A. The re spondent was directed by the Government to vacate the Gov ernment accommodation on the ground that he had let out residential accommodation of which he was owner.
The respondent No. 1 accordingly filed eviction proceedings against the appellant claiming possession under Section 14A. The appellant contended before the Rent Controller that the ground did not fail within the sweep of section 14A since the premises were let out for residential rum com mercial purposes to, a joint Stock Company which was carry ing on business besides using for the residence of its Managing Director.
This plea did not cut ice with the Con troller who refused leave to contest.
The appellant filed a writ petition in the High Court under Art 226 of the Consti tution which was dismissed.
In appeal by special leave, the appellant contended that 1.
Nothing in s.14A compels the landlord to occupy the premises after evicting the tenant.
He could still let it for a higher rent, take on lease from the private sector a small house and make a gain, from the difference flowing in rent.
The Controller could not shut him out from being heard if a triable issue emerged from the affidavit in opposition.
In the present case such issues were present and, therefore, the Rent Controller was not justi fied in refusing leave to contest.
Section 14A does not apply in the present case since the premises were not residential premises as they were let out both for commercial and residential purposes.
313 (Krishna lyer, J.) Dismissing the appeal, HELD: (1) It is fallacious to approximate section 25B(5) with Order 37 rule 3 of the Code of Civil Procedure.
The social setting demanding summary proceeding, the nature.
of the subject matter and above all, the legislative diction which has been deliberately designed, differ in the two provisions.
Disclosure of facts which disentitle recovery of possession is a sine qua non for grant of leave.
[320 F A, 321A] (2) The definition of premises in section 2(i) covers any building or part of the building leased for use, resi dential, commercial or other.
To attract section 14A the landlord must be in occupation of residential premises allotted to him by the Central Government.
He must be required by order of that Government to vacate his residen tial accommodation.
The Delhi Development Authority granted the land to respondent No. 1 for construction of a residen tial building although it was let out for commercial pur pose.
Residential premises are not only plots which are let out for residential purposes nor do all kinds of structures where humans may manage to.
dwell are residential.
Use or purpose of the letting is no conclusive test.
Whatever is suitable or adaptable for residential use, even by making some changes, cart be designated residential premises.
Once it is residential in the liberal sense, section 14A strands attracted.
In the present case the house was built on land given for constructing a residence, is being used even now for residence is suitable otherwise for residence and is being credibly demanded for the respondent 's residence.
Residential suitability being the basic consideration, the building is residential.
The `purpose test ' will enable officers who own houses to defeat the statute that they do not own residential premises though it was suitably built for residence.
The scheme of section 14A definitely contem plates a specific representation from landlord to the Controller that because he has been ordered to vacate the premises where he is residing he requires immediate posses sion for his occupation.
It 's non obstante clause, the vesting of a right to immediate recovery, the creation of a summary process and the package of connected provisions all emphasize that the amendments have to be viewed as a whole, that the court cannot be fooled and the statute mocked at.
The cause of action is not only the Government orders to vacate but consequential urgency to recover his own build ing.
Parliament cannot be.
assumed not to intend the obvi ous, or to.
intend the ludicrous.
Literality is not right where obscurity is the result.
[321 C D, G H 322 C D, 323 A B, G H] Gillespie Brothers & Co. Ltd. vs Roy Bowles Transport Ltd. quoted in 39 MUd.
L.R. 379 (1976) and Anderson vs Abbott ; at 366 67 quoted in Univ.
of Pennsylvenia Law Review Vol. 117 (1968) p. 1, 63, quoted with approval.
(3) Judicial machinery while enforcing the law shall forbid its being misused.
[325 E] (4) The possibility of the power of Government to issue orders to vacate being used discriminately should be care fully avoided.
If exceptions are made in the case of big officers, naturally the.
middling and the lesser minions of Government may have a grievance.
It may ' perhaps be proper for Government when allotting good premises for high offi cers who made from their own houses large returns to pay into the Government coffers some: equitable part of the gain so made, giving consideration to circumstances like loans investment and the like.
[325 G H]


judgement:
ivil Appeal Nos. 227 and 228/ 1976.
(From the Judgment and Order dated 8 1 1976 of the Patna High Court in C.W.J.C. No. 1053 and 1054 of 1975).
252 L.M. Singhvi, Sri Narain and K.J. John, for the appellants.
L.N. Sinha, Sol.
U.P. Singh and Shambhu Nath Jha, for the respondents.
The Judgment of the Court was delivered by BEG, C.J.
These appeals are before us after certifica tion of the cases, raising identical questions of law as fit for appeal to this Court, dealt with by one judgment and orders of a Division Bench of the, Patna High Court on two writ petitions.
The petitions were directed against orders of the State Government passed in 1974 revising the rate of royalty payable by the petitioners appellants under a lease of 1970, and, after that, cancelling the lease by a letter of ' 15th March, 1975.
The petitioners ' case was that the revision of the rate of royalty payable by the petitioners for the lease to, collect and exploit sal seeds from the forest area was illegal during the subsistence of the lease, and thereafter, cancellation of the lease itself was illegal for various reasons.
Primarily, the case of the petitioners is that of a breach of contract for which the State would be liable ordinarily to pay damages if it had broken it.
If the petitioners could establish some right, either contrac tual or equitable, to continue in possession, the State could be prevented, by appropriate proceedings, from ousting the petitioners from the forest land from which the peti tioners have been gathering sal seeds.
The petitioners had also set up mala fides on the part of the Conservator of Forests, in enhancing the royalty unreasonably and then cancelling the lease, allegedly acting under the influence of friends and associates of the Forest Minister of Bihar.
The relevant clause relating to revision of royalty in the written contract reads as follows : "The rate of royalty will be revised every three years ' cycle in consultation with the lessee and the decision will be binding on the lessee".
Apparently, there is no restriction, under the terms of the contract, upon the amount by which the royalty could be increased by a revision after a three years ' cycle under this clause.
The lessee is only entitled, under the con tract, to be consulted before a revision.
But, the decision of the Governmental authorities to enhance is binding upon him after that.
Hence, if this was the only term of the contract on this question, the petitioners could not complain of unreasonable enhancement in the revised rate of royalty.
Under clause 4 of the lease, the lessee had to establish a factory within the State of Bihar for processing of sal seeds and extraction of oil therefrom within period of five years from the date of the agreement, failing which the agreement itself was to terminate.
The questions which apparently arose appertained to action alleged by the State to fall within the terms of the agreement between the par ties regulated by the duly signed contract which was presum ably executed in compliance with the provisions of Article 299 of the Constitution.
Prima facie, therefore, the appel lants can only get their 253 remedies, if they can obtain any at all, through ordinary suits for damages or for injunctions to restrain breaches of contract provided they could show how the contracts were broken or were going to be broken.
The writ petitions, however, raise questions relating not only to action lying within the sphere regulated by the law of contract, but, according to the petitioners, by constitutional provisions relating to the exercise of the executive powers of the State Government contained in Arti cle 298 which reads as follows : "298.
The executive power of the Union and of each State shall extend to the carrying on of any trade or business and to the acquisition, holding and disposal of property and the making of contracts for any purpose: Provided that (a) the said executive power of the Union shall, in so far as such trade or business or such purpose is not one with respect to which Parliament may make laws, be subject in each State to legislation by the State; and (b) the said executive power of each State shall, in so far as such trade or business or such purpose is not one with respect to which the State Legislature may make laws be subject to legislation by Parliament".
It is urged vehemently by Dr. L.M. Singhvi, appearing on behalf of the petitioners appellants, that the State, acting in its executive capacity through its Government or its officers, even in the contractual field, cannot escape the obligations imposed upon it by Part III of the Constitution.
The only article, however, in Part III of the Constitution relied upon by Dr. Singhvi is Article 14 which says: "14.
The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India".
It can be and has been urged on behalf of the State that Governmental authorities when acting in the contractual field, could not be controlled by Article 14 of the Consti tution at all.
When the State had entered into contracts with citizens who carry on their trade and pay the royal ties.
In accordance with the agreements reached between the State and citizens, it does not exercise any special governmental or statutory powers.
In such cases, the State as well as the citizen with whom it contracts are both equally subjected to the law of contract.
It has been urged on behalf of the respondent State that there has been nO breach of contract in the cases before us.
The State is, according to the learned Solicitor General, appearing for the State of Bihar, not claiming to be above the law of contract governing all parties which subject themselves to the law of contract.
The dispute whether there is or there i.s not a breach of contract should, according to the con tention on behalf of the State, be determined by ordinary civil courts as in every case 254 between ordinary litigants who cannot invoke the powers of the High Courts under Article 226 of the Constitution simply because there is a dispute whether an agreement has been broken or not.
Equal subjection of all parties, including the State, to the same procedural requirements, when such disputes are to be adjudicated upon, means that the State should be placed on the same footing as an ordinary liti gant.
It should neither enjoy special benefits and privi leges, nor be subjected to special burdens and disadvan tages.
This should, it is urged, follow from a strict application of Article 14 if the State were to be, as a party to a contract and a litigant, placed on the same footing as other .parties who enter into such contracts.
It is true that the special provisions of Article 299 of the Constitution are there to protect public interest so that 'the contracts by or on behalf of the Government have to comply with the special requirements of form.
But, once the State enters into the contractual sphere after the require ments of form, contained in Article 299, have been complied with, does it have to take its place, in the eye of law, side by side with ordinary parties and litigants or has it any special obligations or privileges attached to it even when it acts within this field ? Dr. Singhvi 's argument that the State Government had some special obligations attached to it would have appeared more plausible if it could be shown that the State or its officers or agents had practised some discrimination against the petitioners appellants at the very threshold or at the time of entry into the field of contract so as to exclude them from consideration when compared with others on any unreasonable or unsustainable ground struck by Article 14 of the Constitution.
It is true that the Article 14 of the Constitution imports a limitation or imposes an obligation upon the State 's executive power under Article 298 of the Constitution.
All constitutional powers carry corresponding obligations with them.
This is the rule of law which regu lates the operation of organs of Government functioning under a Constitution.
And, this is exactly what was meant to be laid down by this Court in Erusian Equipment & Chemi cals Ltd. vs State of West Bengal & Anr.,(1) on which learned counsel for the appellants sought to rely strongly.
It was held there (at p. 677) : "Under Article 298 of the Constitution the Executive power of the Union and the State shall extend to the carrying on of any trade and to the acquisition, holding and dis posal of the property and the making of con tracts for any purpose.
The State can carry on executive function by making a law or without making a law.
The exercise of such powers and functions in trade by the State is subject to Part HI of the Constitution.
Article 14 speaks.
of equality before the law and equal protection of the laws.
Equality of opportunity should apply to matters of public contracts.
The State has the right to trade.
The State has therefore the duty to observe equality.
An ordinary individual (1) ; at 677.
255 can choose not to deal with any person.
The Government cannot choose to exclude persons by discrimination.
The order of black listing has the effect of depriving a person of equal ity of opportunity in the matter of public contract.
A person who is on the approved list is.
unable to enter into advantageous rela tions with the Government because of the order of black listing.
A person who has been dealing with the Government in the matter of sale and purchases of materials has a legiti mate interest or expectation.
When the State sets to the prejudice of a person it has to be supported by legality".
It is thus clear that the Erusian Equipment & Chemicals Ltd. 's case (supra) involved discrimination at the very threshold or at the time of entry into the field o,f consid eration of persons.
with whom the Government could contract at all.
At this stage, no doubt, the State acts purely in its executive capacity and is bound by the obligations which dealings of the State with the individual citizens import into every transaction entered into in exercise of its constitutional powers.
But, after the State or its agents have entered into the field of ordinary contract, the rela tions are no longer governed by the constitutional provi sions but by the legally valid contract which determines rights and obligations of the parties inter se.
No question arises of violation of Article 14 or of any other constitu tional provision when the State of its agents, purporting to act within this field, perform any act.
In this sphere,_ they can only claim rights conferred upon them by contract and are bound by the terms of the contract only unless some statute steps in and confers some special statutory power or obligation on the State in the contractual field which is apart from contract.
In the cases before us the contracts do not contain any statutory terms or obligations and no statutory power of obligation which could attract the application of Article 14 of the Constitution is involved here.
Even in cases where the question is of choice or consideration of compet ing claims before an entry into the field of contract facts have to be investigated and found before the question ,of a violation of Article 14 could arise.
If those facts are disputed and require assessment of evidence the correctness of which can ,only be tested satisfactorily by taking de tailed evidence, involving examination and cross examina tion of witnesses, the case could not be conveniently or satisfactorily decided in proceedings under Article '226 of the Constitution.
Such proceedings are summary proceedings reserved for extraordinary cases where the exceptional and what are described as, perhaps not quite accurately, "pre rogative" powers of the Court are invoked.
We are certain that the cases before us are not such in which powers under Article 226 of the Constitution could 'be invoked.
The Patna High Court had, very rightly divided the types of cases 'in which breaches of alleged obligation by the State units agents can be set up into three types.
These were stated as follows : "(i) Where a petitioner makes a grievance of breach of promise on the part of the State in cases where an assurance 256 or promise made by the State he has acted to his prejudice and predicament, but the agree ment is short of a contract within the meaning of article 299 of the Constitution; (ii) Where the contract entered into between the person aggrieved and the State is in exercise of a statutory power under certain Act or Rules framed thereunder and the petitioner alleges a breach on the pan of State; and (iii) Where the contract entered into between the State, and the person aggrieved is non statutory and purely contractual and the rights and liabilities of the parties are governed by the terms of the contract, and the petitioner complains about breach of such contract by the State.
" It rightly held that the cases such as Union of India vs M/s. AngloAfghan Agencies,(1) and Century Spinning & Manu facturing Co. Ltd. vs Ulhasnagar Municipal Council(2); and Robertson vs Minister of Pensions,(3) belong to the first category where it could be held that public bodies or the State are as much bound as private individual are to carry out obligations incurred by them because parties seeking to bind the authorities have altered their position to their disadvantage or have acted to their detriment on the strength of the representations made by these authorities.
The High Court thought that in such cases the obligation could sometimes be appropriately enforced on a Writ Petition even though the obligation was equitable only.
We do not propose to express an opinion here on the question whether such an obligation could be enforced in proceedings under Article 226 of the Constitution now.
is enough to observe that the cases before us do not belong to this category.
The Patna High Court also distinguished cases which belong to the second category, such as K.N. Guruswami vs The State of Mysore;(4) ' D.F. South Kheri vs Ram Sanehi Singh;(5) and M/s. Shree Krishna Gyanoday Sugar Ltd. vs The State of Bihar,(6) where the breach complained of was of a statutory obligation.
It correctly pointed out that the cases before us do not belong to this class either.
It then, very rightly, held that the cases now before us should be placed in the third category where questions of pure alleged breaches of contract are involved.
It held, upon the strength of Umakant Saran vs The State of Bihar;(7) and Lekhrai Sathram Das vs
N.M. Shah;(8) and B.K. Sinha vs State of Bihar(9) that no writ order can issue under Article 226 of the Constitution in such cases "to compel the authorities to remedy are a breach of contract pure and simple".
(1) ; (2) A.I.R. 1971 S.C. 1021.
(3) [1949] 1 King 's Bench 227.
(4) ; (5) A.I.R. 1973 S.C. 205.
(6) (7) A.I.R. 1973 S.C. 964.
(8) ; (9) A.I.R. 1974 Patna 230.
257 Learned counsel for the appellants has, however, relied upon a passage from Lekhraj Sathram Das 's case (supra) where this Court observed (at p. 231); " . until and unless in the breach is involved violation of certain legal and public duties or violation of statutory duties to the remedy of which the petitioner is entitled by issuance of a writ of mandamus, mere breach of contract cannot be remedied by the Court in exercise of its powers under Article 226 of the Constitution".
Learned counsel contends that in the cases before us breaches of public duty are involved.
The submission made before us is that, whenever a State or its agents or offi cers deal with the citizen, either when making a transaction or, after making it, acting in exercise of powers under the terms of contract between the parties, there is a dealing between the State and the citizen which involves performance of "certain legal and public duties.
" If we were to accept this very wide proposition every case of a breach of con tract by the State or its agents or its officers would call for interference under Article 226 of the Constitution.
We do.
not consider this to be a sound proposition at all.
Learned counsel for the appellants cited certain author ities in an attempt to support his submission that the State and its Officers are clothed with special Constitutional obligations, including those under Article 14 of the Consti tution, in all their dealings with the public even when a contract is there to regulate such dealings.
The authori ties cited were: D.F. South Kheri vs Ram Sanehi Singh (supra) where all that was decided, relying upon K.N. Gurus wamy vs The State of Mysore (supra), was that, where the source of a right was contractual but the action complained of was the purported exercise of a statutory power, relief could be claimed under Article 226; and, Calcutta Gas Co. (Proprietary) Ltd. vs State of West Bengal & Ors,(1) where the real question considered was whether the petition er had a locus standi to question the validity of an enact ment; Basheshat Nath vs The Commissioner of Income Tax, Delhi & Rajasthan and Anr.,(2) which has nothing to do with any breach of contract but only lays down that "Article 14 protects us from both legislative and administrative tyranny of discrimination"; State of M.P. & Anr.
vs Thakur Bharat Singh.(3) which lays that even executive action must not be exercised arbitrarily but must have the authority of law to support it; S.S. Sawhney v.D. Ramarathnam, Assistant Pass port Officer.
of India, New Delhi & Ors.
,(4) which repeats requirements of action which satisfy Article 14 and 21 of the Constitution where compliance with these provi sions is obligatory.
(2) [1959] Suppl.
1 S.C.R. 528 at 551.
(3) ; (4) 2 4365CI/77 258 We do not think that any of these cases could assist the appellants or is at all relevant.
None of these cases lays down that, when the State or the officers purport to operate within the contractual field and the only grievance of the citizen could be that the contract between the parties is broken by the action complained of, the appropriate remedy is by way of a petition under Article 226 of the Constitu tion and not an ordinary suit.
There is a formidable array of authority against any such a proposition.
In Lekhraj Sathramdas Lalwani vs M.M. Shah, Deputy Custodian cum Managing Officer, Bombay & Ors., (supra) this Court said (at p. 337); "In our opinion, any duty or obligation falling upon a public servant out of a con tract entered into by him as such public servant cannot be enforced by the machinery of a writ under article 226 of the Constitution".
In Banchhanidhi Rath vs The State of Orissa & Ors(1) this Court declared (at p. 845): "If a right is claimed in terms of a contract such a right cannot be enforced in a writ petition." In Har Shankar & Ors. etc. etc.
vs The Dy.
Excise & Taxation Commr.
& Ors.
,(2) a Constitution Bench of this Court ob served (at p. 265): "The appellant have displayed ingenuity in their search for invalidating circumstances but a writ petition is not an appropriate remedy for impeaching con tractual obligations".
Learned Solicitor General, appearing for the State, contended that there could be no aspect of Article 14 of the Constitution "involved in a case where no comparison of the facts and circumstances of a particular petitioner 's case with those of other persons said to be similarly situated is involved.
In such a case, he submitted, there was no possibility of inferring a discrimination.
In reply, learned counsel for the appellants sought to direct our attention towards some allegations showing that there was discrimination between appellants and other parties gov erned by similar contracts in other areas.
We doubt very much whether the doctrine of discrimination can be at all availed of against the State 's section purporting to be taken solely within the contractual field when n6 aspect of any statutory or ConStitutional obligation appears either from incontrovertible facts or applicable legal provisions.
Indeed, it has been held fin C.K. Achutan vs State of 'Ker ala & Ors.,(3) that no question of a violation of Article 14 arises even where one out of the several persons ' is: se lected by the State for a particular contractual transac tion.
Learned counsel for the appellants submitted that there was a conflict between what was laid down here and the law declared by this Court in Erusian Equipment & Chemicals .Ltd. 's case (supra).
We think that the two cases are distinguishable on facts.
The propositions of law laid down in the two cases must be read in the context of facts established in each case.
In any event, A.I.R. 1972 S.C. 843 at 845.
(2) ; at 265 (3) [1959] Suppl.
(1) S.C.R. 787.
259 the cases before us do.
not raise any question of discrimi nation alleged at the stage of entry into the contractual area which could attract the application of Article 14.
In the cases.before us, allegations on which a violation of Article 14 could be based are neither properly made nor established.
Before any adjudication on the question wheth er Article 14 of the Constitution could possibly be said to have been violated, as between persons governed by similar contracts, they must be properly put in issue and estab lished.
Even if the appellants could be said to have raised any aspect of Article 14 of the Constitution and this Arti cle could at all be held to operate within the contractual field whenever the State enters into such contracts, which we gravely doubt, such questions of fact do not appear to have been argued before the High Court.
And, in any event, they are of such a nature that they cannot be satisfactorily decided without a detailed adduction of evidence, which is only possible in ordinary civil suits, to establish that the State, acting in its executive capacity through its Offi cers, has discriminated between parties identically situat ed.
On the allegations and affidavit evidence before us we cannot reach such a conclusion.
Moreover, as we have al ready indicated earlier, the correct view is that it is the contract and not the executive power, regulated by the Constitution, which governs the relations of the parties on facts apparent in the cases before us.
The real object of the appellants seems to be to hold up any adjudication on the cases before us by taking shelter behind Article 14 so that the stay orders obtained by them, presumably on representations made to this Court that no aspect of enforcement of Article 14 of the Constitution 'was involved.
We think that to accede to the prayer on behalf of the appellants to.
adjourn the hearing of these cases until after the Emergency is lifted and.
yet to continue the stay orders is to permit a circumvention of the Constitutional mandate contained in Article 359 and to countenance a gross abuse of the processes of the Court.
A rather desparate argument which has been addressed to us on behalf of the appellants is that they were entitled to an opportunity to.
show cause against the cancellation of the leases.
It was urged, on the strength of A.K. Kraipak & Ors. etc.
vs Union of India & Ors.
,(1) that the distinction made between administrative and quasi judicial action is thin and a vanishing one.
This argument appears to.
us to be wholly irrelevant inasmuch as a question of the distinc tion between an administrative and quasi judicial decision can only arise in the exercise of powers under statutory provisions.
Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties.
When a contract is sought to be terminated by the Officers of the State, purporting to act under the terms of an agreement between parties, such action is not taken in purported exercise of a statutory power at all.
In Additional District Magistrate, Jabalpur, vs Shiva kant Shukla,(2)it was pointed out (at p. 1288): (1) (2) ; at 1288.
260 "The principles of natural justice which are so implied must always hang, if one may so put it, on pegs of statutory provisions or necessarily follow from them.
They can also be said sometimes to be implied as necessary parts of the protection of equality and equal protection of laws conferred by Article 14 of the Constitution where one of the pillars of Dicey 's principles of the Rule of Law is found embodied.
Sometimes, they may be implied and read the legislation dealing with rights protected by Article 19 of the Constitution.
They could at times, be so implied because 'restrictions on rights conferred by Article 19 of the Constitution have to be reasonable".
The limitations imposed by rules of natural justice cannot operate upon powers which are governed by the terms of an agreement exclusively.
The only question which normally arises in such cases is whether the action com plained of is or is not in consonence with the terms of the agreement.
As already pointed out by us, even if by some stretch of imagination some case of unequal or discrimina tory treatment by the officers of the State of persons governed by similar contracts is sought to be made out ', a satisfactory adjudication upon the unusual facts of such a case would necessitate proper pleadings supported by accept able evidence.
In that case, the interim stay order or injunction could not be justified at all because so long as a Residential Order, under Article 359 of the Constitution, is operative, the enforcement of fundamental rights falling under Article 14 is suspended.
In such cases even if a petition or suit is entertained and kept pending no stay order could be passed because that would amount to indirect ly enforcing the fundamental rights conferred by Article 14 of the Constitution.
It is only where a prima facie case for an injunction or stay can be made out, quite apart from a right covered by Article 14 of the Constitution or by any other fundamental right whose enforcement may have been suspended, that an injunction or stay could be granted at all on suitable 'terms.
As we have already said it was on such an assumption that this Court had, apparently, granted the interim stay which must now be discharged.
Consequently, we dismiss these appeals with costs throughout, and discharge the stay orders.
S R. Appeals dismissed.

summary/full:
A contract called a "lease" to collect and exploit sal seeds from forest area was entered into in 1970, between the respondent State and the appellants in 1970.
Clause (3) in the written contract executed in accordance with the provi sions of article 299 of the Constitution provided for the revision of the. rate of royalty at the expiry of every three years in consultation with the lessee and was to be binding on the lessee.
Under clause (4) of the. lease, the lessee.
had to establish a factory within the, State of Bihar for processing of sal seeds and extraction of oil therefrom within a period of five.
years from the date.
of the, agreement, failing which the agreement itself was to terminate.
In 1974, the respondent State revised the rate of royalty payable, by the appellants and after that, can celled the lease by a letter dated 15th, March 1975.
The writ petitions challenging the said orders were dismissed by the Patna High Court.
On appeals by certificates, the appellants contended: (i) the State acting in its executive capacity through its Government or its officers even in the contractual field cannot escape the obligation imposed upon it by Part III of the Constitution; (ii).
Article 14 of the Constitution has been infringed and (iii) Principles.
of natural justice have.
been violated as no opportunity to show cause against the cancellation of lease was given.
Dismissing the appeals the Court, HELD: (1) Article.
14 of the Constitution imports a limitation or imposes an obligation upon the States execu tive power under article 298 of the Constitution.
The rule of law which regulates.
the operation are organs of Government functioning under the Constitution is that all constitution al powers carry ' corresponding obligations with them.
[254 E F] Erusian Equipment & Chemicals Ltd. vs State of West Bengal and Anr.
1975(2) SCR 674 at 677, referred to.
(2) The State acts purely in its executive capacity and is bound by the obligations which dealings of the State with the individual citizens import into every transaction en tered into in exercise of its constitutional powers, only at the time of entry into the field of consideration of per sons with whom the Government could contract at all.
But, after the State or its agents have entered into the field of ordinary contract the relations are no longer governed by the constitutional provisions but by the legally valid contract which determines rights and obligations of the parties inter se.
[255 C D] 250 (3 ) Article 14 or of any other constitutional provision is not violated when the State or its agents purporting to act within the contractual field perform.
any act.
In this sphere they can only claim rights conferred upon them by contract and are bound by the terms of the contract only unless some statute steps in and confers some special statu tory power or obligation on the State in the contractual field which is apart from contract.
In the instant case, the contracts do not contain any statutory terms or obliga tions and no statutory ' power or obligation which could attract the application of article 14 of the Constitution is involved.
[255 D E, 260 E F] (4) The doctrine of discrimination cannot be availed of against the State 's action purporting to be taken solely within the contractual field when no aspect of any statutory or constitutional obligation appears either from incontro vertible facts or of facts.
The appellants ', cases do not raise any question of discrimination alleged at the stage of entry into the contractual area which could attract the application of Article 14.
[258 F G, 259 A] C.K. Achuthan vs State of Kerala and Ors.
1959 Supp.
(1) SCR 787, applied.
Erusian Equipment & Chemicals vs State of West Bengal & Ant. , distinguished.
(5) Before any adjudication on the question whether Article 14 of the Constitution could possibly be held to have been violated as between persons governed by similar contracts, they must be properly put in issue and estab lished.
The question whether Article 14 could at all be held to operate within the.
contractual field whenever the State enters into such contracts is such that it cannot be decided without a detailed adduction of evidence which is only possible in ordinary civil suits, to establish that the State, acting in its executive capacity through its offi cers, has discriminated between parties identically situat ed.
In the instant case allegations on which a violation of article 14 could be based are neither properly made nor estab lished.
It is the contract and not the executive power regulated by the Constitution which governed the relations of the parties.
[259 A D] (6) Proceedings under article 226 are, summary proceedings reserved for extraordinary cases where the exceptional and what are described perhaps not quite accurately as "preroga tive" powers of the court are invoked.
If the facts are disputed and require assessment of evidence, the correctness of which can only be tested satisfactorily by taking de tailed evidence involving examination and cross examination of witnesses, the case could not be conveniently or satis factorily decided in proceedings under article 226 of the Constitution.
Even in cases where the question is of choice or consideration of competing claims before an entry into the field of contract facts have to be investigated and found before the question of violation of article 14 could arise.
The appellants ' cases are not such in which powers under Article 226 of the Constitution could be invoked.
[255 E G] Lekhraj Satnam Das Lalvani vs
M.M. Shah, Deputy Custodi an cum Managing Officer ; ; Banchhanidhi Rath vs The State of Orissa & Ors.
AIR 1972 SC 843 @ 845 and Har Shankar & Ors.
vs The Dy.
Excise. & Taxation Corotar.
& Ors. 3 ; @ 265, reiterated.
D.F. South Kheri vs Ram Sangi Singh AIR 1973 SC 205; K.N. Guruswamy vs State of Mysore, ; ; Calcutta Gas Co. (Proprietary) Ltd. vs State of West Bengal & Ors. ; Basheshat Nath vs Commissioner of Income Tax, 1959 Supp.
(1) SCR 528; State of M.P. vs Thakur Bharat Singh 1967(2) SCR 454 and S.S. Sawhney
D. Ramarathnam, Assistant Pass port Officer, Govt.
of India, New Delhi & Ors. , held not applicable.
(7) The Patna High Court had very rightly divided the types of cases in which breaches of alleged obligation by the State or its agents can be set up into three types: (i) Where a petitioner makes a grievance of breach of an obliga tion of the State in cases where on an assurance or repre sentation of, the State, he has acted to his prejudice and detriment but the agreement is 251 short of a contract within the meaning of article 299 of the Constitution; (ii) Where the contract entered into between the person aggrieved and the State is in exercise of a statutory power under certain Act or Rules framed thereunder and the petitioner alleges a breach on the part of the State; (iii) Where the contract entered into between the State and the person aggrieved is nonstatutory and purely contractual and the rights and liabilities of the parties are governed by the terms of the contract and the petitioner complains about breach of such contract by the State.
The High Court rightly held that the appellants cases should be placed in the third category where questions of pure alleged breaches of contract are involved and that no writ or order can issue under Article 226 of the Constitution in such cases to compel the authorities to remedy a breach of con tract pure and simple [255 H, 256 A B, F G] Umakant Saran vs The State of Bihar AIR.
and Lekhraj Satram Das vs N.M. Shah ; , followed.
B.K. Sinha vs State of Bihar AIR 1974 Patna 230, approved.
Union of India vs M/s. Anglo Afgan Agencies ; ; Century Spinning and Manufacturing Company Ltd. vs Ulhasnagar Municipal Council AIR 1971 SC 1021; Robertson vs Minister of Pensions (1949)(1) K.B. 227; K.N. Guruswamy vs State of Mysore AIR ; ; D.F. South Kheri vs Ram Sanghi Singh AIR 1973 SC 205; M/s. Shrikrishna Gyanaday Sugar Ltd. vs The State of Bihar , distin guished and held inapplicable.
(8) The object of the appellants is to hold up any adjudication on the cases, by taking shelter behind Article 14 so that the stay orders obtained by them may continue.
To accede to the prayer to adjourn the hearing of the cases until after the emergency is lifted and yet to continue the stay orders is to permit circumvention of the constitutional mandate contained in article 359 and to countenance gross abuse of the process of the court.
[259 D E] (9) The interim stay or order or injunction could not be justified at all because so long as the Presidential Order under article 359 of the.
Constitution is operative, the en forcement of Fundamental Rights falling under Art.14 of the Constitution is suspended.
In such cases even if a petition or a suit is entertained and can be pending no stay order could be passed because that would amount to indirectly enforcing the Fundamental Rights conterred by article 14 of the Constitution.
It is only where a prima facie case for an injunction of stay can be made out, uqite apart from a right governed by article 14 of the Constitution or of any other Fundamental Rights whose enforcement may have been suspend ed, that an injunction could be granted at all in suitable cases on suitable terms.
[260 C E] Additional District Magistrate, Jabalpur vs Shivkant Shukla ; @ 1288 1976 Supp.
SCR, 172 re ferred to.
(10) The appellants are not entitled to an opportunity to show cause against the cancellation of the leases.
The question of distinguishing between an administrative and quasi judicial decision can only arise in the exercise of powers exercised under statutory provisions.
Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties.
When a contract is sought to be terminated by the officers of the State purporting to act under the terms of an agreement between parties, such action is not taken in purported exercise of an agreement between parties, such action is not taken in purported exercise cannot operate upon powers which are governed by the terms of an agreement exclusively.
The only question which normally arises in such cases is whether the action complained of is or is not in consonance with the terms of the agreement.
[259 F H, 260 C]