{"id":73678,"date":"1999-08-22T00:00:00","date_gmt":"1999-08-21T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/union-territory-chandigarh-anr-vs-ram-chander-sons-ors-on-22-august-1999"},"modified":"2019-03-05T10:03:17","modified_gmt":"2019-03-05T04:33:17","slug":"union-territory-chandigarh-anr-vs-ram-chander-sons-ors-on-22-august-1999","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/union-territory-chandigarh-anr-vs-ram-chander-sons-ors-on-22-august-1999","title":{"rendered":"Union Territory Chandigarh & Anr vs Ram Chander & Sons & Ors on 22 August, 1999"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Union Territory Chandigarh & Anr vs Ram Chander & Sons & Ors on 22 August, 1999<\/div>\n
Author: Sethi<\/div>\n
Bench: R.P.Sethi, S.Saghir Ahmad<\/div>\n
           PETITIONER:\nUNION TERRITORY CHANDIGARH & ANR\n\n\tVs.\n\nRESPONDENT:\nRAM CHANDER & SONS & ORS.\n\nDATE OF JUDGMENT:\t22\/08\/1999\n\nBENCH:\nR.P.Sethi, S.Saghir Ahmad\n\n\n\n\nJUDGMENT:\n<\/pre>\n
SETHI, J.\n<\/p>\n
L…..I………T…….T…….T…….T…….T…….T..J<\/p>\n
      Delay condoned in SLP(C)….\/99 (CC 902\/99).\n<\/p>\n
      Leave  granted.\tSector 17 is a commercial centre  in
\nChandigarh,  the  city beautiful of India which is also\t the
\ncapital\t of  Punjab  and Haryana, the  two  most  prosperous
\nStates\tof  the\t country.  Shopkeepers\tof  this  commercial
\ncentre are aggrieved of the enhancement of the rent of their
\nleased\tpremises  from Rs.2,671\/- to Rs.14,000\/-  per  month
\nwhich,\taccording to them, is irrational, unwarranted by law
\nand  arbitrary being 600 per cent increase.  The shops under
\ntheir  occupation  are stated to have been initially  leased
\nout  to\t them at a paltry rent of Rs.525\/- with effect\tfrom
\n10th May, 1968.\t Whereas the respondent Union Territory have
\nsteadily enhanced the rent from time to time, the appellants
\nherein\t have  unsuccessfully  put   all  types\t of  hurdles
\nconceivable under the present legal system.  Almost admitted
\nfacts  leading to the filing of the present appeals are that
\nthe  appellants were leased commercial premises in Sector 17
\nof  Chandigarh\tin  or about the  years\t 1963-64.   However,
\nformal\tlease deeds were executed between the Lessor and the
\nLessees\t in May, 1968 on payment of monthly rent of Rs.525\/-
\nper mensem in advance by the 19th day of the month for which
\nit  fell due.  The lease was initially for a period of\tfive
\nyears  from the date of the grant which could be  terminated
\nby  the\t Lessor\t by  giving one month’s\t advance  notice  in
\nwriting\t to the Lessees.  The lease was renewable only\tonce
\nfor another term of five years with 20% increase in the rent
\nreserved under the deed.  In the event of non payment of the
\nrent  on  the  due date or breach or non observance  by\t the
\nLessee\tof  any of the conditions of the lease deed, it\t was
\nlawful\tfor  the Lessor, notwithstanding the waiver  of\t any
\nprevious cause or right for re-entry, to terminate the lease
\nand enter into and upon the building or any part thereof and
\nto  re-possess, retain and enjoy the same and in that  event
\nthe  Lessee was not entitled to the refund of lease money or
\nany  part  thereof  or\tto any\tcompensation  whatsoever  on
\naccount of such resumption.  After the expiry of the initial
\nperiod\tof  10\tyears, the rent of the leased  premises\t was
\nincreased to Rs.2,671\/- per month with effect from 1.3.1982.
\nBeing  aggrieved by the increase of rent, the Lessees  filed
\nwrit  petitions\t in  the High Court of Punjab &\t Haryana  in
\nwhich  their  plea was not accepted and a Division Bench  of
\nthe High Court vide its judgment dated 4th August, 1988 held
\nthat  there  was no evidence to show that the enhanced\trent
\nwas,  in  any  way, unreasonable or  arbitrary.\t  The  Court
\nfurther\t observed,  “in fact we had a feeling that  this  is
\nmuch  lower  than the fair payable rent in respect  of\tsuch
\npremises”.   However,  as by then the Lessees had agreed  to
\npay  the enhanced rent with effect from 1st March, 1982 till
\nthe end of February, 1991, the Court set aside the orders of
\ntermination  of their leases which had been passed on  their
\nfailure\t to  pay  the  enhanced rent.\tThe  petitions\twere
\ndisposed of holding:\n<\/p>\n
      “The  result  would  be  that he shall  be  deemed  to
\ncontinue  to be lessee under the Estate Administration.\t  We
\nshall  now  execute  a lease deed agreeing to  pay  rent  as
\naforesaid.   The rent shall be revisable for the period from
\nMarch  1,  1991\t as  per the existing rules  of\t the  Estate
\nAdministration.\t The arrears for the period of March 1, 1982
\ntill July 31, 1988, shall be paid on or before September 30,
\n1988  and  the rent for the month of August, 1988  shall  be
\npaid  on  or before the 10th of September, 1988 and for\t the
\nmonth  of September 1988, it shall be paid on or before\t the
\n10th  October,\t1988  and for every subsequent month  on  or
\nbefore the 10th of each subsequent month.”\n<\/p>\n
      After  the expiry of the period prescribed by the High
\nCourt,\tthe Lessees were allowed to remain in possession but
\nwere  slapped with a notice on 19th August, 1992  intimating
\nthem  to renew the lease subject to enhancement of rent from
\nRs.2,671\/-  to Rs.14,000\/- with effect from 1.3.1992 pending
\ndecision   of\tthe  Chandigarh\t  Administration   for\t the
\nintervening  period  i.e.   1.3.1991 to\t 29.2.1992  for\t the
\nincrease of rent at enhanced rates which was intimated to be
\nbinding upon the Lessees as and when increased.\t The Lessees
\nwere called upon to renew fresh lease deeds in favour of the
\nrespondents  containing\t the terms and\tconditions  detailed
\ntherein.   Feeling  that  the  enhanced\t rent  was  illegal,
\nunfair, arbitrary and uncalled for, the Lessees of the shops
\nin  Sector 17 filed various writ petitions in the High Court
\nof  Punjab  &  Haryana\tat  Chandigarh.\t  One  set  of\tsuch
\npetitions  Nos.10520-21\t of 1996 entitled Dr.Sahib  Singh  &
\nSons  vs.   Chandigarh Administration were disposed of\tvide
\njudgment  Annexure  P-4\t upholding the right  of  the  Union
\nTerritory  Chandigarh  to enhance the rent with\t appropriate
\ndirections needed in the peculiar facts and circumstances of
\nthe  case.  Contending that their cases were different\tthan
\nSahib  Singh’s\tmatter, the appellant herein insisted for  a
\nfresh  hearing\tand  a separate judgment.   The\t prayer\t was
\naccepted  and the Division Bench vide its detailed  judgment
\ndated 19th December, 1997 dismissed the petitions but in the
\ncircumstances  directed that if the appellants convey  their
\nconsent\t to  the  terms and conditions incorporated  in\t the
\nimpugned  notices  within three months, the respondents\t may
\nrenew the lease granted to such of the appellants subject to
\ntheir  paying  the arrears of rent within six  months.\t The
\nrespondents  were entitled to charge appropriate interest on
\nthe  amount of arrears of rent between 1.3.1992 to the\tdate
\nof  the\t stay orders obtained by them from the\tHigh  Court.
\nFor  the period during which the payment of the rent at\t the
\nrates  specified in the impugned notices remained stayed  by
\nthe  Court,  the appellants were directed to pay interest  @
\n18%  per  annum.  The amount of interest was required to  be
\npaid  by  the appellants within six months from the date  of
\nthe  judgment.\tThus, all such appellants who failed to give
\ntheir  consent\tin terms of the direction or failed  to\t pay
\narrears along with interest within the time specified in the
\njudgment were to forfeit their right to remain in possession
\nof  the properties leased out to them and the respondents in
\nthat  event  were declared to be absolutely free to  recover
\npossession  thereof  in\t accordance  with  law.\t  The  Court
\ndirected the respondents to take urgent steps to enhance the
\nrent  of  other\t similar properties situated  in  Sector  17
\nregarding  which the complaints were made by the  appellants
\non  the\t plea of discrimination.  It may be noticed that  by
\nthe  time the High Court delivered the judgment in the\tcase
\nof  the\t appellants,  this Court had dismissed the  SLP\t (C)
\nNo.18466  of  1997 which was filed against the\tjudgment  in
\nSahib Singh’s case, by order dated 29th September, 1997.  To
\nprotract the litigation further, the appellants filed Review
\nPetitions   before  the\t High\tCourt  praying\ttherein\t  to
\nreconsider  the matter or atleast absolve the appellants  of
\ntheir  liability to pay the interest as awarded by the\tmain
\njudgment.   The Review Petitions were also dismissed on 17th
\nJuly,  1998.   Immediately  after the pronouncement  of\t the
\norders\tin  review petitions, the counsel for the  appellant
\nmade  a statement that his clients were prepared to pay\t the
\namount\tof  interest  for  which he wanted  some  time.\t  He
\nrequested  for the grant of six months time for the  purpose
\nbut  the Court allowed three months time in the interests of
\njustice.   These  appeals  are\tdirected  against  the\tmain
\njudgment of the High Court dated 19th December, 1997 and the
\norders\tin  Review Petitions dated 17th July, 1998.   It  is
\ncontended  that\t the impugned judgment and order is  against
\nlaw,  without  jurisdiction  and  the  result  of  arbitrary
\nexercise  of  powers.  Learned counsel who appeared for\t the
\nappellants  have  vehemently argued that admittedly  in\t the
\nabsence\t of  the  rules,  required to be  framed  under\t the
\nCapital\t of Punjab (Development & Regulation) Act, 1952, the
\nrespondent Administration had no jurisdiction to enhance the
\nrent.\tAlternatively,\tconceding that such  power  existed,
\nthey  have argued that the exercise of power has been unfair
\nand  arbitrary.\t  It is submitted that the respondent  being
\nthe regulator and dispenser of special services and provider
\nof large number of benefits including the granting of leases
\nare  required to act fairly and reasonably.  The  discretion
\nof the respondents even if assumed is not unlimited and that
\nthe  respondents  cannot  give\tor withhold  leases  in\t its
\narbitrary  discretion  or at its sweet will.  It is  further
\nsubmitted  that the High Court was not justified in awarding
\nthe  interest  for the period of stay granted by it  in\t the
\ncases  filed  by the appellants.  There is no  dispute\tthat
\nCapital\t of  Punjab  (Development &  Regulation)  Act,\t1952
\n(hereinafter  referred\tto  as `the Act’) being\t Punjab\t Act
\nNo.27  of 1952, is applicable to the city of Chandigarh with
\neffect\tfrom  1968.  The Act was enacted at a time when\t the
\nconstruction  of  a  new  capital  of  the  then  Punjab  at
\nChandigarh  was in progress.  It was considered necessary to
\nvest the State Government with a legal authority to regulate
\nthe  sale of building sites and to promulgate building rules
\non  the\t lines of municipal bye-laws so long as\t a  properly
\nconstituted  local body did not take over the administration
\nof the city.  Section 3 of the Act provides:\n<\/p>\n
      3.   “Power  of  Central\t Government  in\t respect  of
\ntransfer  of land and buildings in Chandigarh.- (1)  Subject
\nto  the\t provisions of this section, the Central  Government
\nmay  sell, lease or otherwise transfer, whether by  auction,
\nallotment  or  otherwise, any land or building belonging  to
\nthe Government in Chandigarh on such terms and conditions as
\nit  may,  subject to any rules that may be made\t under\tthis
\nAct, think fit to impose.\n<\/p>\n
      (2)  The\tconsideration money for any  transfer  under
\nsub-section  (1) shall be paid to the Central Government  in
\nsuch  manner  and  in such instalments and at such  rate  of
\ninterest as may be prescribed.\n<\/p>\n
      (3)  Notwithstanding  anything contained in any  other
\nlaw   for  the\ttime  being  in\t force,\t until\tthe   entire
\nconsideration  money  together\twith interest or  any  other
\namount,\t if any, due to the Central Government on account of
\nthe  transfer  of  any\tsite or\t building,  or\tboth,  under
\nsub-section  (1) is paid, such site or building, or both, as
\nthe  case  may be, shall continue to belong to\tthe  Central
\nGovernment.”\n<\/p>\n
      Sub-Section  (1)\tof Section 3 itself  authorises\t the
\nCentral\t Government to sell, lease or otherwise transfer any
\nland or building belonging to it in Chandigarh on such terms
\nand  conditions\t as it may think fit to impose.\t  Conditions
\nfor sale, lease and transfer can be regulated by rules which
\nmay be made under the Act.  Section 22 of the Act authorises
\nthe  Central  Government to make rules for carrying out\t the
\npurposes of the Act which include:\n<\/p>\n
      “(a)  the\t terms and conditions on which any  land  or
\nbuilding  may be transferred by the Central Government under
\nthis Act.\n<\/p>\n
      (b)  the\tmanner in which consideration money for\t any
\ntransfer may be paid;\n<\/p>\n
      (c)  the\trate of interest payable, and the  procedure
\nfor  payment of instalments, interest, fees, rents or  other
\ndues payable under this Act;\n<\/p>\n
      (d)  the terms and conditions under which the transfer
\nof any right in any site or building may be permitted;\n<\/p>\n
      (e) erection of any building or the use of any site;<\/p>\n<\/blockquote>\n
      (f) levy of fees or taxes under section 7;<\/p><\/blockquote>\n
      (g)  the terms and conditions for the breach of  which
\nany site or building may be resumed;\n<\/p>\n
      (h)  the conditions with regard to the buildings to be
\nerected on sites transferred under this Act;\n<\/p>\n
      (i) the form of notice and the manner in which notices
\nmay be served;\n<\/p>\n
      (j)  the\tform  and  manner   in\twhich  appeals\t and
\napplications  under this Act may be filed and the court fees
\nleviable on such appeals and applications;\n<\/p>\n
      (k)  the\tmatters\t referred to in sub-section  (2)  of
\nsection 5;\n<\/p>\n
      (l)  any\tother  matter  which has to  be\t or  may  be
\nprescribed.”\n<\/p>\n
      The  combined reading of Sections 3 and 22 of the\t Act
\nwould indicate the existence of an obligation on the Central
\nGovernment  to make rules for the purposes of regulating the
\nterms  and  conditions relating to the transfer of  property
\nincluding  leasing  it\tout.  However, failure to  make\t the
\nrules  would  not render the transfer of the  property\tmade
\nunder\tthe  terms  of\tthe   lease  as\t illegal,  void\t  or
\ninoperative.   Learned counsel appearing for the appellants,
\nafter some arguments, also conceded the vesting of powers in
\nthe  respondents  to sell, lease or otherwise  transfer\t the
\nproperty  in  the Union Territory of Chandigarh\t subject  to
\nsuch conditions as it thought fit.  They did not insist that
\nthe  lease  could  not be made or the  terms  including\t the
\nenhancement of rent could not be imposed without framing the
\nrules.\t We  are also of the opinion that power to  transfer
\nthe  property  including  leasing it out  is  authorised  by
\nSection\t 3  itself and its terms and conditions left to\t the
\nsatisfaction of the Central Government.\t Though, not legally
\nobliged\t to  make  the\trules, the  Central  Government\t was
\nobliged\t to  take steps in making the rules  regulating\t the
\ntransfer  of properties contemplating transfer of properties
\nby  the\t modes\tenvisaged under the  Section,  for  allaying
\napprehensions  of the citizens regarding discrimination\t and
\narbitrariness.\t It would have been in the interests of\t the
\nCentral\t Government  itself to frame the rules for  infusing
\nconfidence  and rationality, reasonableness and fairness  in
\ntheir  actions.\t  We  trust  and   hope\t that  the   Central
\nGovernment  would  not loose any further time in making\t the
\nrules as mandated by the Section and embark upon enhancement
\nof  rent, if deemed necessary, only under such rules, as and
\nwhen made for the purposes of carrying on the objects of the
\nAct  to\t their logical conclusions.  In the absence  of\t the
\nrules, the action of the respondents regarding imposition of
\nterms  and conditions of the lease including the enhancement
\nof  rent  is  required\tto be fair and\treasonable  and\t not
\nactuated   by  considerations  which   could  be  termed  as
\narbitrary or discriminatory.  The government cannot act like
\na  private individual in imposing the conditions solely with
\nthe  object  of\t extracting   profits  from  their  lessees.
\nGovernmental  actions are required to be based on  standards
\nwhich  are  not\t arbitrary or unauthorised.  This  Court  in
\nRamana\tDayaram\t Shetty\t vs.\tThe  International   Airport
\nAuthority  of India & Ors.  (AIR<\/a> 1979 1629=1979 (3) SCC 489)
\nwhile agreeing with the observations of Mathew,J.  held:\n<\/p>\n
      “We  agree with the observations of Mathew, J., in  v.
\nPunnan Thomas v.  State of Kerala AIR 1969 Ker 81 (FB) that:
\n“The  Government,  is  not and should not be as free  as  an
\nindividual  in\tselecting  the recipients for  its  largess.
\nWhatever   its\tactivity,  the\t Government  is\t still\t the
\nGovernment  and\t will be subject to restraints, inherent  in
\nits   position\tin  a\tdemocratic  society.   A  democratic
\nGovernment   cannot  lay  down\t arbitrary  and\t  capricious
\nstandards  for the choice of persons with whom alone it will
\ndeal”  The  same  point was made by this  Court\t in  Erusian
\nEquipment  and\tChemicals  Ltd.\t Vs.  State of\tWest  bengal
\n(1975)\t2 SCR 674;  (AIR 1975 SC 266) where the question was
\nwhether\t black-listing\tof  a person without giving  him  an
\nopportunity  to\t be heard was bad?  Ray, C.J.,\tspeaking  on
\nbehalf\tof  himself and his colleagues on the Bench  pointed
\nout  that  black-listing  of a person not only\taffects\t his
\nreputation  which  is in Poundian terms as interest both  of
\npersonality  and substance, but also denies him equality  in
\nthe matter of entering into contract with the Government and
\nit cannot, therefore, be supported without fair hearing.  It
\nwas  argued for the Government that no person has a right to
\nenter  into contractal relationship with the Government\t and
\nthe  Government, like any other private individual, has\t the
\nabsolute  right\t to  enter  into contract with\tany  one  it
\npleases.   But the court, speaking through the learned Chief
\nJustice, responded that the Government is not like a private
\nindividual  who can pick and choose the person with whom  it
\nwill  deal, but the Government is still a Government when it
\nenters into contract or when it is administering largess and
\nit  cannot, without adequate reason, exclude any person from
\ndealing\t with  it  or take away\t largess  arbitrarily.\t The
\nlearned\t Chief\tJustice\t said that when\t the  Government  is
\ntrading\t with the public, “the democratic form of Government
\ndemands\t  equality  and\t  absence  of\tarbitrariness….The
\nactivities  of\tthe  Government have a public  element\tand,
\ntherefore, there should be fairness and equality.  The State
\nneed not enter into any contract with anyone, but if it does
\nso,  it must do so fairly without discrimination and without
\nunfair\tprocedure.” This proposition would hold good in\t all
\ncases  of  dealing by the Government with the public,  where
\nthe  interest  sought  to be protected is a  privilege.\t  It
\nmust,  therefore,  be  taken to be the law  that  where\t the
\nGovernment  is\tdealing with the public, whether by  way  of
\ngiving\tjobs or entering into contracts or issuing quotas or
\nlicences  or granting other forms of largess, the Government
\ncannot act arbitrarily at its sweet will and, like a private
\nindividual,  deal with any person it pleases, but its action
\nmust  be  in conformity with standard or norm which  is\t not
\narbitrary,   irrational\t or  irrelevant.    The\t  power\t  or
\ndiscretion  of\tthe  Government in the matter  of  grant  of
\nlargess\t including award of jobs, contracts quotas, licences
\netc.,  must be confined and structured by rational, relevant
\nand  non-  discriminatory  standard  or\t  norm\tand  if\t the
\ngovernment  departs  from  such\t standard  or  norm  in\t any
\nparticular case or cases, the action of the Government would
\nbe  liable to be struck down, unless it can be shown by\t the
\nGovernment  that  the departure was not arbitrary,  but\t was
\nbased  on  some\t valid\tprinciple which in  itself  was\t not
\nirrational, unreasonable or discriminatory.”\n<\/p>\n
      Even  the administrative orders and not quasi judicial
\nare  required  to  be made in a manner consonance  with\t the
\nrules of natural justice, when they affect the rights of the
\ncitizens  to the property or the attributes of the property.
\nWhile exercising the powers of judicial review the Court can
\nlook  into the reasons given by the Government in support of
\nits action but cannot substitute its own reasons.  The Court
\ncan  strike down an executive order, if it finds the reasons
\nassigned  were\tirrelevant and extraneous.  The\t courts\t are
\nmore  concerned\t with the decision making process  than\t the
\ndecision itself.  This Court in Kumari Shrilekhs Vidyarthi &
\nOrs.   Vs.   State of U.P.  & Ors.  [1991 (1) SCC 212]\theld
\nthat  every  State action, in order to survive, must not  be
\nsusceptible  to the vice of arbitrariness which is the\tcrux
\nof  Article  14\t and basic to the rules of law,\t the  system
\nwhich  governs\tus, arbitrariness being the negation of\t the
\nrule   of  law.\t  Non-arbitrariness,   being   a   necessary
\nconcomitant  of\t the rule of law, it is imperative that\t all
\nactions\t of every public functionary in whatever sphere must
\nbe  guided  by\treason\tand not\t humour,  whim,\t caprice  or
\npersonal  predilections\t of the persons entrusted  with\t the
\ntask  on behalf of the State and exercise of all powers must
\nbe  for public good instead of being an abuse of the  power.
\nAction of renewability should be gauged not on the nature of
\nfunction  but  public  nature of the  body  exercising\tthat
\nfunction  and  such action shall be open to judicial  review
\neven  if it pertains to contractual field.  The State action
\nwhich  is  not informed by reason cannot be protected as  it
\nwould  be  easy for the citizens to question such an  action
\nbeing  arbitrary.   In\tthe  instant  case,  the  respondent
\nAdministration\trelied\tupon Memo No.317 dated 16.3.1992  of
\nthe  Executive\tEngineer  CP   Division\t No.3  Chandigarh  ,
\nGovernment  of\tPunjab\tcircular dated 15th  May,  1996\t and
\naffidavit  of Shri Krishanjeet Singh, Executive Engineer, CP
\nDivision  No.5,\t Union Territory, Chandigarh filed in  Civil
\nWrit  No.10521\/96 to justify their action of enhancement  of
\nrent  being  fair  and\treasonable.   Memo  dated  16.3.1992
\nreferred to earlier Memo No.122 dated 3.2.87 and the meeting
\nheld  in the office of the Chief Engineer, U.T.\t  Chandigarh
\non 4.3.1992.  It was mentioned in the memo that the rates of
\nrent  earlier  recommended had become obsolete and that\t the
\naccommodation  was  not available to the Government on\thire
\nbasis  at those rates keeping in view the plinth area  which
\nhad been revised for the purposes of calculating the rent of
\nprivate\t buildings hired by the Government with effect\tfrom
\n1.3.1992.  It was further stated in the memo that:\n<\/p>\n
      “The  land rates already conveyed in Memo No.122 dated
\n3.2.87\tshall  be applicable,, but the rental value will  be
\ncalculated @ 9% per annum.\n<\/p>\n
      S.No.  Description Rates proposed for adoption Remarks
\n1 .  Ground Floor Rs.2450.00 Sqa.  The plaint area rates.  2
\n.  First Floor Rs.2250.00 P.So<\/p>\n
      3 .  Second floor and so on Rs.2250.00 P.So<\/p>\n
      4 .  Extra for terrace tiles\/terrace flooring in rooms
\nverandha except toilets Rs.  65.00<\/p>\n
      5\t .  Extra for glazed\/spartik or equivalent tiles  in
\nflooring and dado in toilets and kitchen Rs.  350.00<\/p>\n
      6 .  Extra for marble flooring Rs.  900.00<\/p>\n
      7\t .  Extra for teek wood joinery only alongwith brass
\nfittings  Rs.\t440.00\tFor  door  and\twindow\tonly.\t8  .
\nConcrete  paving  beyond  plint\t area of  the  building\t Rs.
\n100.00<\/p>\n
      9\t .   Land  scaping of grassed  Rs.1000.00  Kanal  of
\ngrassed area.\n<\/p>\n
      Note:\n<\/p>\n
      1.  The amount so evolved for the building portion may
\nbe  reduced  by\t 20%  and thereafter rental  volume  may  be
\ncalculated  @  9%  PA.\t2.  Since the rates have  been\tmade
\napplicable  w.e.f.   1.3.1992 depreciation @ 1% per year  of
\nthe  age of the building should be taken (only for  building
\nportion except cost of land).\n<\/p>\n
      II.   Cost  of Land a) Upto Ist Kanal (upto  Rs.453.00
\n(Four  hundred\t500  sq.yards) and fifty three\tonly)  P.Sq.
\nyds.)<\/p>\n
      b)  II  Kanal (501 to 1000 sq.yds)  Rs.356.00  (Rupees
\nthree hundred and fifty six only per sq.yds.\n<\/p>\n
      c)  For  remaining area (above Rs.227.00\t(Rupees\t two
\n1000 sq.yds) hundred and twenty seven only per Sq.Yds.)<\/p>\n
      d) Extra for preferential plots 10%<\/p>\n
      III)  Rental value for cost of land so evolved will be
\ncalculated @ 9% per annum.\n<\/p>\n
      B)  For  commercial  purposes rent so evolved  on\t the
\nabove  rates  shall  be increased five\ttimes.”\t (underlying
\nsupplied)<\/p>\n
      Government of Punjab circular dated 15th May, 1996 was
\nalso  on  the  subject\tof periodical revision\tof  rent  of
\nprivate\t  buildings.   While  justifying   the\t action\t  of
\nenhancement  of\t rent  and showing it to be  reasonably\t and
\nfairly\tfixed,\tShri  Krishanjeet  Singh  in  his  affidavit
\n(Annexure  P-5) had stated:  “The assessment at monthly rent
\nof  Rs.14,000\/- in respect of the aforesaid SCO was assessed
\nas follows:\n<\/p>\n
      Covered  area of SCO is 2066.62 sq.ft.  which comes to
\n192.06\tsq.meters.  The cost of construction per Sq.Meter at
\nground\tfloor  in  the\tyear 1992  was\tRs.2450\/-  for\tsuch
\nbuildings.  This figure of Rs.2450\/- is based on actual cost
\nof  construction  of  similar  other type  of  buildings  in
\nChandigarh.   Thus, the total cost of construction of ground
\nfloor comes to Rs.4,70,547\/- (192.06 sq.mtrs.  x 2450\/-).\n<\/p>\n
      SCO  51  being an old construction, the total cost  of
\nconstruction  was  reduced by 20%.  After that 1% per  annum
\ndepreciation  was  also\t permitted for 29 years as  per\t the
\nnorms.\tThe details are given hereunder:\n<\/p>\n
      Total   cost   of\t construction\t Of   ground   floor
\nRs.470547.00<\/p>\n
      2450  x  192.06  less 20% Rs.   94109.00\t____________
\nRs.376438.00<\/p>\n
      Less   1%\t  depreciation\tper   Annum  for  29   years
\nRs.109167.00 ____________ Rs.267271.00<\/p>\n
      3.   That\t for  the determination of the\tannual\trent
\nvalue,\t9% of net cost of construction is to be taken  which
\ncomes  to Rs.24054\/- (9% of Rs.267271\/- = Rs.24054\/-).\tThis
\nfigure\tof Rs.24054\/- represents rental value per annum,  on
\nthe  total cost of construction which may be marked as\t“A”.
\nFor  calculating the cost of land on which aforesaid SCO has
\nbeen  built which has an area of 2066 sq.ft.  which is equal
\nto  229.62 sq.yards.  As per letter Annexure R\/A Rs.453\/- is
\nthe  cost of per sq.yard which amounts to total cost of land
\nas  Rs.104018\/-.   This\t figure\t has   been  arrived  at  by
\nmultiplying 229.62 sq.\tyards by Rs.453\/- (229.62 sq.yards x
\nRs.453\/-).   For determing the annual rental value again  we
\nhave to deduct 9% of cost of land i.e.\tRs.104018\/- which is
\nrental value per annual as Rs.9362\/-.  This may be marked as
\n“B”.   Thus  the  annual rental value of the  aforesaid\t SCO
\ncomes  to Rs.33416\/- by adding “A” and “B”.  For determining
\nthe rental value per month Rs.33416\/- is to be divided by 12
\nand  we\t would\tget  the rent per month which  is  equal  to
\nRs.2785\/-.  The aforesaid SCO being commercial this is to be
\nmultiplied  by\t5  times  which\t  comes\t to  Rs.13925\/-\t say
\nRs.14000\/-.”\n<\/p>\n
      In the written statement filed in the petitions of the
\nappellants, the respondent had stated:\n<\/p>\n
      “13.   That the admitted portion of the para 13 of the
\nwrit  petition calls for no comments.  It is submitted\tthat
\nCompetent  Authority granted approval vide Annexure R\/2\t for
\ncharging  the  rent  w.e.f.  1.3.1992 on the  basis  of\t the
\nreassessment  of  rent made by the  Engineering\t Department,
\nChandigarh  Administration.  During the year 1970 Govt.\t  of
\nIndia  through\tFinance\t Secretary   Memo  dated   25.5.1970
\ninformed  that the market rent or the rent calculated  under
\nFR  45\twith  Departmental charges, whichever is  higher  is
\nrecoverable  in\t respect  of Govt.  accommodation  used\t for
\ncommercial purpose.  The Finance Secretary vide letter dated
\n12.6.1975  approved  the  charging of rent at  the  rate  of
\nRs.1.10\t per  sq.foot in respect of shops\/booths  in  Sector
\n17-E.\tAccordingly  the lessees in Sector 17 were  informed
\nthat  from  1.3.1982 rent of Rs.2671\/- per month for a\tshop
\nand  Rs.1090\/-\tfor  a booth will be  charged.\t Three\twrit
\npetitions  as already submitted (CWP No.3581, 3582, 3583  of
\n1983) were filed.  This Hon’ble High Court disposed of these
\nwrit petitions vide judgment annexed with this writ petition
\nas  Annexure P\/3.  A perusal of this judgment shows that the
\napproval  was granted for charging of the rent in respect of
\nSCO\/Booths  in Sector 17-E, Chandigarh w.e.f.  1.3.92 at the
\nrate  as  contained  in this letter.  Thus,  the  figure  of
\nRs.14000\/-  per month is based on the re-assessment of\trent
\nby  the Engineering Department of Chandigarh Administration.
\nThe petitioner is, thus, liable to pay this market rent.\n<\/p>\n
      14.   That  in reply to the averments as contained  in
\npara  14 of the writ petition it is submitted that the shops
\nmentioned  by the petitioner in this para are not rented out
\nby  the\t Chandigarh Administration to the  various  parties.
\nThe  said shops are owned by the private individuals and are
\nfurther\t rented\t out to the parties mentioned in  the  para.
\nBut  the  present  shop in occupation of the  petitioner  is
\nrented\tby  the\t Government.  The market rent  calculated  @
\nRs.14,000\/-  per month in respect of ground floor of the SCO
\nin  question and in occupation of the petitioner is based on
\nthe  assessment\t made  by   the\t Engineering  Department  of
\nChandigarh   Administration  and  the\tsame  is   justified
\nreasonable,  constitutional  and  as  such  deserves  to  be
\nupheld.”\n<\/p>\n
      The  High\t Court\texamined  the matter  in  depth\t and
\nrightly\t concluded  that the procedure adopted and made\t the
\nbasis  for  enhancing  the rent could not be  termed  to  be
\neither\tarbitrary, discriminatory or unreasonable.  We agree
\nwith  the conclusions arrived at by the High Court and\tfind
\nno infirmity in the action of the respondents in raising the
\nrate  of  rent\ton the basis of the grounds  noticed  by  us
\nhereinabove.   Such  an\t action\t is   stated  to  have\tbeen
\nuniformly  applied  with  respect  to  all  the\t shopkeepers
\nsimilarly  situated and placed.\t Mere inaction in respect of
\ncertain\t tenants  could\t not be made the basis\tfor  setting
\naside  the  action  initiated  against\tthe  appellants\t and
\nothers.\t  The respondents assured and the High Court rightly
\nissued appropriate directions for initiating similar actions
\nagainst\t those\twho  are  left out.   Dealing  with  such  a
\nsituation  this\t Court in Chandigarh Administration  &\tAnr.
\nVs.  Jagjit Singh & Anr.  [1995 (1) SCC 745]has held:\n<\/p>\n
      “Generally   speaking,   the  mere   fact\t  that\t the
\nrespondent-authority  has  passed a particular order in\t the
\ncase  of another person similarly situated can never be\t the
\nground for issuing a writ in favour of the petitioner on the
\nplea  of  discrimination.  The order in favour of the  other
\nperson\tmight  be legal and valid or it might not be.\tThat
\nhas to be investigated first before it can be directed to be
\nfollowed  in  the case of the petitioner.  If the  order  in
\nfavour of the other person is found to be contrary to law or
\nnot warranted in the facts and circumstances of his case, it
\nis  obvious that such illegal or unwarranted order cannot be
\nmade   the   basis  of\tissuing\t  a  writ   compelling\t the
\nrespondent-authority  to  repeat the illegality or  to\tpass
\nanother\t  unwarranted\torder.\t   The\t extraordinary\t and
\ndiscretionary  power  of the High Court cannot be  exercised
\nfor such a purpose.  Merely because the respondent-authority
\nhas  passed  one  illegal\/unwarranted  order,  it  does\t not
\nentitle\t the  High Court to compel the authority  to  repeat
\nthat   illegality  over\t again\t and  again.   The  illegal\/
\nunwarranted  action  must  be corrected, if it can  be\tdone
\naccording  to  law  – indeed, wherever it is  possible,\t the
\nCourt  should  direct the appropriate authority\t to  correct
\nsuch  wrong  orders in accordance with law – but even if  it
\ncannot\tbe  corrected, it is difficult to see how it can  be
\nmade  a basis for its repetition.  By refusing to direct the
\nrespondent-authority  to repeat the illegality, the Court is
\nnot  condoning\tthe earlier illegal act\/order nor  can\tsuch
\nillegal\t  order\t constitute  the   basis  for  a  legitimate
\ncomplaint  of  discrimination.\tGiving effect to such  pleas
\nwould  be  prejudicial to the interests of law and  will  do
\nincalculable  mischief\tto  public interest.  It will  be  a
\nnegation  of law and the rule of law.  Of course, if in case
\nthe  order  in favour of the other person is found to  be  a
\nlawful\tand  justified one it can be followed and a  similar
\nrelief\tcan  be given to the petitioner if it is found\tthat
\nthe petitioners’ case is similar to the other persons’ case.
\nBut  then  why examine another person’s case in his  absence
\nrather\tthan  examining\t the case of the petitioner  who  is
\npresent\t before the Court and seeking the relief.  Is it not
\nmore  appropriate and convenient to examine the\t entitlement
\nof  the petitioner before the Court to the relief asked\t for
\nin  the facts and circumstances of his case than to  enquire
\ninto  the  correctness of the order made or action taken  in
\nanother\t person’s case, which other person is not before the
\ncase  nor  is his case.\t In our considered opinion,  such  a
\ncourse\t-barring  exceptional situations – would neither  by
\nadvisable  nor\tdesirable.  In other words, the\t High  Court
\ncannot\tignore the law and the well-accepted norms governing
\nthe  writ  jurisdiction and say that because in one  case  a
\nparticular  order has been passed or a particular action has
\nbeen  taken,  the same must be repeated irrespective of\t the
\nfact  whether such an order or action is contrary to law  or
\notherwise.   Each  case must be decided on its\town  merits,
\nfactual\t and  legal,  in   accordance  with  relevant  legal
\nprinciples.   The  orders  and actions\tof  the\t authorities
\ncannot\tbe equated to the judgments of the Supreme Court and
\nHigh  Courts  nor can they be elevated to the level  of\t the
\nprecedents, as understood in the judicial world.”\n<\/p>\n
      It  is not the case of the appellants that the  favour
\ndone  to those whose rent has not been enhanced is legal  or
\nvalid.\tSuch an omission is also not referable to any lawful
\naction\tof the respondents.  The question of  discrimination
\nwould  arise only if it is found that the order in favour of
\nthe  left over was legal and valid and that the case of\t the
\nwrit  petitioners  was similar in material respects  to\t the
\ncase  of such persons.\tNo such allegation has been made  or
\narguments  addressed.  There is, therefore, no basis for the
\nappellants  to\turge  the violation of Article\t14  alleging
\ndiscrimination\tagainst\t them.\t Regarding awarding  of\t the
\ninterest  by  the  High Court for the period of stay  it  is
\nargued\tthat as in Sahib Singh’s case no such direction\t was
\nissued,\t the  appellants  could\t not be\t burdened  with\t the
\nliability of paying the interest and that at the rate of 18%
\nper  annum  was\t excessive and exorbitant.   It\t is  settled
\nprinciple  of  law  that  as and when a\t party\tapplies\t and
\nobtains\t a  stay from the Court of law, it is always at\t the
\nrisk and responsibility of the party applying.\tMere passing
\nof  an order of stay cannot be presumed to be the conferment
\nof  any\t additional right upon the litigating  party.\tThis
\nCourt  in  Shree Chamundi Mopeds Ltd.  Vs.  Church of  South
\nIndia  Trust  Assn.   [1992(3)\tSCC 1] held  that  the\tsaid
\nportion\t of  order  by the court mean only that\t such  order
\nwould  not  be operative from the date of its passing.\t The
\norder  would  not mean that the order stayed had been  wiped
\nout  from  existence.\tThe order of  stay  granted  pending
\ndisposal  of  a case comes to an end with the  dismissal  of
\nsubstantive  proceeding\t and it is the duty of the Court  in
\nsuch  cases  to\t put the parties in the same  position\tthey
\nwould  have  been but for the interim orders of\t the  Court.
\nAgain  in Kanoria Chemicals and Industries Ltd.\t & Ors.\t Vs.
\nU.P.  State Electricity Board & Ors.  [1997 (5) SCC 772] the
\nCourt  held  that  the grant of stay had not the  effect  of
\nrelieving  the\tlitigants  of their obligation to  pay\tlate
\npayment\t with  interest on the amount withheld by them\twhen
\nthe  writ  petition  was   dismissed  ultimately.    Holding
\notherwise  would be against public policy and the  interests
\nof  justice.  In case law Kashyap Zip Industries vs.   Union
\nof  India<\/a>  [1993  (64)\tELT 161], interest  was\t awarded  to
\nRevenue\t for the duration of stay under court’s order, since
\nthe  petitioners  therein were found to have the benefit  of
\nkeeping\t back the payment of duty under orders of the Court.
\nThe  High  Court was, therefore, not wrong in directing\t the
\npayment of interest on the amount of arrears of rent for the
\nperiod\twhen the stay order was obtained till the period the
\nwrit  petitions\t were  dismissed.  We,\thowever,  feel\tthat
\nawarding  of  interest\t@ 18% per annum from  the  aforesaid
\nperiod\twas on the excessive side.  The respondent-authority
\ncould  not  be equated with private commercial\tinstitutions
\nand  conferred with an amount of compensation in the form of
\ninterest  which,  in  the judicial parlance, may  amount  to
\npenalty,  despite  the fact that the persons found  to\thave
\njeopardised  the process of law were rightly held liable  to
\ncompensate the respondent- authority by way of interest.  In
\nour  opinion 15% per annum interest for the aforesaid period
\nwould  have  been just and proper.  We, however, agree\twith
\nthe findings of the High Court that the respondents are free
\nto  charge appropriate interest on the amount of arrears  of
\nrent  between 1.3.1992 to the date when the stay orders were
\npassed\tby the High Court.  We are sure that in\t determining
\nsuch  rate  of interest the respondent-authority  would\t act
\nfairly\tand  justly.  In C.A.  No._______of 1999 (@ SLP\t (C)
\nNos.   17894-95) filed by M\/s.New Rajan Watch Company it was
\nadmitted  that\tthe lease in their case was executed on\t 9th
\nApril,\t1990  on a monthly rent of Rs.1090\/- to be  paid  in
\nadvance\t by  10th day of every month for which it fell\tdue.
\nOne of the terms of the lease deed was:\n<\/p>\n
      “The lease shall be for period of three years from the
\ndate  of  the grant of the lease and shall be terminable  at
\nany time by the lessor by giving one month advance notice in
\nwriting to the lessee and it shall be terminable immediately
\nwithout\t notice\t by the lessor under clause 9  hereof.\t The
\nlease  hereby  granted shall be renewable once\tfor  another
\nterm  of  three\t years\ton the rent  as\t determined  by\t the
\ngovernment.”\n<\/p>\n
      The  appellants  in these appeals have urged that\t the
\nrespondents  had no jurisdiction to enhance the rent  during
\nthe  subsistence  of  the lease deed for a period  of  three
\nyears  from the date of its execution.\tThere appears to  be
\nsubstance in the submission which has not been taken note of
\nby the High Court.  These appellants, however, not justified
\nto  urge  that even for the period of next three years\tthey
\nwere  entitled to the renewal of lease deed on the same rent
\nor  the\t rent  enhanced\t at the rate of\t 20%  at  the  most.
\nCondition   No.4   reproduced\t hereinabove   clearly\t and
\nunambiguously  authorised the respondent-authority to  renew
\nthe lease for another term of three years on the rent as may
\nbe  determined by the Government.  It is, therefore, evident
\nthat for the first period of three years commencing from 9th
\nApril,\t1990  the respondent-authority was not justified  in
\nenhancing  the rent of the shop leased out to M\/s.New  Rajan
\nWatch  Company.\t  The  enhancement of rent  shall,  however,
\ndeemed\tto  be legal, proper and valid with effect from\t 9th
\nApril, 1993.  In the circumstances, the appeals are disposed
\nof  by upholding the judgments and orders impugned except to
\nthe  extent  indicated hereinabove.  The impugned  judgments
\nand  orders shall stand modified to the extent that  instead
\nof paying 18% interest for the period of stay the appellants
\nshall  be liable to pay the interest at the rate of 15%\t per
\nannum.\t In case of M\/s.New Rajan Watch Company the enhanced
\nrent  shall  be deemed to be effective with effect from\t 9th
\nApril,\t1993  and  the\tappellants in those  cases  be\theld
\nentitled to the payment of contractual rate of rent only for
\nthe  period of three years.  It is made clear that the\trent
\nof  the appellants and other lessees similarly situated\t and
\nplaced\tshall not be further enhanced without the framing of
\nrules  as mandated by Section 3 read with Section 22 of\t the
\nAct.  Costs made easy.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Union Territory Chandigarh & Anr vs Ram Chander & Sons & Ors on 22 August, 1999 Author: Sethi Bench: R.P.Sethi, S.Saghir Ahmad PETITIONER: UNION TERRITORY CHANDIGARH & ANR Vs. RESPONDENT: RAM CHANDER & SONS & ORS. DATE OF JUDGMENT: 22\/08\/1999 BENCH: R.P.Sethi, S.Saghir Ahmad JUDGMENT: SETHI, J. L…..I………T…….T…….T…….T…….T…….T..J Delay condoned in […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-73678","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nUnion Territory Chandigarh & Anr vs Ram Chander & Sons & Ors on 22 August, 1999 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/union-territory-chandigarh-anr-vs-ram-chander-sons-ors-on-22-august-1999\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Union Territory Chandigarh & Anr vs Ram Chander & Sons & Ors on 22 August, 1999 - 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