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East Punjab Rent Restriction Law 1949 - Inception and Conception

As the word Rent suggests it can easily be construed that any Rent Law is a law that is used as a tool to control and regulate the relationship and also adjudicate the disputes arising between the landlord and tenant.

The historical background of the rent legislation in the erstwhile State of Punjab relates back to the time of Second World War, which started in the year 1939, when various taxes were imposed by the British Government to set off the cost of the war under the provisions of Punjab Urban Immoveable Property Tax Act, 1940. The effect of imposition of this new tax on the urban property led to a steep rise in rents of the property in the concerned area which further led to the various landlords getting their rented accommodation vacated for letting it out fresh on a higher rent.

In order to control the said situation, and also to avoid the shortage of accommodation, the British Government enacted The Punjab Rent Restriction Act 1941. The object and purpose of the said Act was to ensure that the rent was not increased unduly by the landlords. The said Act came into force, initially for a period of 5 years, however the same could be extended further by a resolution of the State Assembly. The rate of rent, as in the act, was chosen to be the rent existing on 01.01.1939, or the rate on which the properties were first let out. There was a clear embargo in the said Act, whereby the rent could only be increased if the landlord provided extra amenities, at his own expense, to the tenant. Any amount, in excess of the such rent, if taken by the landlord, could be legally recovered back by the tenant.

The said Act was, although, to remain in force for a period of 5 years, but however, it was extended further and continued to operate till the time it was replaced by The Punjab Urban Rent Restriction Act 1947. The said Act introduced the concept of Controller and Appellate Authority (Judicial Authorities to administer the Act), and was made applicable to the entire province.

In this new enactment, grounds of ejectment were introduced, whereby the landlord could seek the ejectment of the tenant from the demised premises only on such grounds and no other; Concept of fair rent was also introduced. Further Many provisions of CODE OF CIVIL PROCEDURE were made applicable for the purpose of summoning of witnesses and execution of orders. Any violation of these provisions was made punishable under section 19 of the said Act.

After the partition of the Country in 1947, the part of Punjab that remained in India was popularly called as East Punjab in those days, and as a result the 1947 Rent Act was replaced by the East Punjab Rent Restrictions Act 1949. The said act was a complete legislation in itself, whereby it not only defined the concept of landlord and tenant, but also classified the building into three categories - residential, non residential and scheduled building, apart from a separate category of rented land. It further laid down the exhaustive procedure for protection of tenants from unscrupulous landlords, but also laid down detailed and exhaustive grounds under Section 13, whereby the landlord could seek the eviction of his tenant. The grounds specified therein were like arrears of rent, subletting, material alteration so as to affect the value and utility of the premises, nuisance, tenant ceasing to occupy and the personal necessity of the landlord.

The East Punjab Urban Rent Restriction Act, 1949 (the Act) - prior to 1956 - permitted a landlord to evict his tenant from a non-residential building on the ground of bona fide requirement for his own use, however, the said right of the landlord was taken away by the East Punjab Urban Rent Restriction (Amendment) Act, 1956 (Punjab Act 29 of 1956) (the Amendment) which came into force on September 24,1956. The relevant provisions of the Act prior to the amendment were as under:

"Section 13 - Eviction of Tenants.

(3)-

(a) A landlord may apply to Controller for an order directing the tenant to put the landlord in possession:

(ii) in case of a non-residential building or rented land, if

(a) he requires it for his own use:

(b) he is not occupying in the Urban Area concerned for the purpose of his business any other such building or rented land as the case may be; and

(c) has not vacated such a building or rented land without sufficient cause after the commencement of this Act, in the Urban Area concerned."

The amendment was enforced by the notification dated September 24, 1956. The relevant provisions of the Amendment are as under:

"1. Short title -This Act may be called the East Punjab Urban Rent Restriction (Amendment) Act, 1956.

2. Amendment of section 13 of East Punjab Act III of 1949. - In clause (a) of sub section (3) of section 13 of the East Punjab Urban Rent Restriction Act, 1949, hereinafter referred to as the principal Act -

(i) (a)

(b)

(ii) (a) In sub-clause (iii) the words "a non-residential building or" shall be omitted.

(b) In sub-paragraph (b), the words "building or" and the words "as the case may be" shall be omitted.

(c) In sub-paragraph (c), the words "a building or" shall be omitted.

(iii)

(iv) In sub clause (iv), for the words "any building", where they first occur, the words ("any residential building") shall be substituted.

In the second proviso, for the words "a residential, a scheduled or non-residential building or rented land", the words ("a residential building or rented land") shall be substituted.

After the enforcement of the amendment the provisions of the Act are as under:

"(3) (a) A landlord may apply to Controller for an order directing the tenant to put the landlord in possessions.

(ii) in case of (X X X) rented land, if.

(a) he requires it for his own use;

(b) he is not occupying in the urban area concerned for the purpose of his business any other such 2(X X X ) rented land 3 (X X X), and

(c) has not vacated such 4 (X X X) rented land without sufficient cause after the commencement of this Act, in the urban area concerned."

A bare perusal of the above-mentioned Amendment, and unamended provisions, will reveal that prior to the coming into force of the Amendment, a landlord could seek eviction of his tenant from a non-residential building for his own bona fide requirement, but the said amendment had taken away the said right of the landlord.

The constitutional validity of the said amendment was challenged in the case of Harbilas Rai Bansal v. The State of Punjab & Anr. (AIR 1996 SC 857), whereby the Supreme Court while relying upon its earlier constitutional bench Judgement in Gian Devi Anand v. Jeevan Kumar & Ors. 1985(2) SCC 683, had struck down the said amendment as unconstitutional. The relevant portion of the observation made by the Supreme Court is as under :-

"The observations of the Constitution Bench that "bona fide need of the landlord will stand very much on the same footing in regard to either class of premises, residential or commercial" fully support the view, we have taken, that the classification created by the amendment has no reasonable nexus with the object sought to be achieved by the Act. We, therefore, hold that the provisions of the amendment, quoted in earlier part of the judgment, are violative of Article 14 of the Constitution of India and are liable to be struck- down.

We allow the appeal, set aside the impugned judgment of the High Court, declare the above said provisions of the amendment as constitutionally invalid and as a consequence restore the original provisions of the Act which were operating before coming into force of the amendment. The net result is that a landlord - under the Act - can seek eviction of a tenant from a non-residential building on the ground that he requires it for his own use. The parties to bear their own costs. "

Thus, after the said amendment was struck down by the Hon'ble Supreme Court, the landlord under the said Act of 1949, is free to seek ejectment of the tenant from the demised premises for his own occupation from a residential as well as a commercial building.

In case an ejectment is sought by the landlord on the ground of his personal necessity, then although it has been held by various Courts that the rent controller shall proceed on a presumption that the requirement of landlord is bonafide [Sarla Ahuja 1998 (2) RCR (R) 533] and again in 2004 (1)RCR (R) 395, however, this does not mean that the ejectment of the tenant is automatic, and is on mere asking. On the other hand, for seeking the ejectment of a tenant on the said ground, the landlord has to satisfy the conscious of the court, and strictly fall under the parameters of Section 13, as envisaged under the said Act, and prove that his need is more than a mere wish and a desire, and also that he is not guilty of any concealment as envisaged under section 13(3)(a) 1(b) and (c). The said situation came to be analysed before the Hon'ble Punjab and Haryana High court in the full bench judgement of Banke Ram v. Smt. Sarasti Devi (AIR 1977 P&H 158) when it was held as under :-

"To sum up, the reply to the question referred for decision is that it is essential for a landlord to plead the ingredients of Sub-clauses (to) and (c) of paragraph (i) of Section 13 (3) (a) of the Act in his eviction application and that the decision of the Division Bench in Krishan Lal Seth's case (1961-63 Pun LR 865) (supra), in this regard, does not lay down a good law."

However, it may also be relevant to point out here that while the Full Bench clearly held that it is essential for the landlord to plead the ingredients of sub clause b and c of section 13 (3) (a), it also held in para 12 of its decision that:

" In the present case, we are concerned only with the question as a principle of law as to whether it is essential to plead in an eviction application the ingredients of Sub-clauses (b) and (c) and not the question that if in a particular case these ingredients are not pleaded, but the parties have led evidence with regard to them, what will be the effect? In any given case, where facts have not been averred in the pleading, a number of questions can arise as to whether proper evidence has been adduced by the landlord regarding those facts which do not find place in the pleadings and secondly whether such evidence will be admissible or not and lastly, whether the tenant was taken by surprise or not and had led evidence with full knowledge of the requisite contentions raised toy the landlord and whether the tenant has in those circumstances been prejudiced or not. The Court would be required to give full consideration to the contentions raised by the respective parties and the facts and circumstances of each case before giving its decision in favour of the landlord or the tenant, tout the decisions of the High Courts or the Supreme Court, in this regard, cannot be of any avail to detract from the validity of the proposition that it is necessary for the landlord to make averments regarding the ingredients of Sub-clauses (b) and (c). However, it may be made clear that when it is held that it is essential to plead the ingredients of Sub-clauses (b) and (c) in the eviction application by the landlord, it should not be understood that under no circumstances, in the absence of pleadings, the evidence regarding the ingredients envisaged in Sub-clauses, (b) and (c) can be looked into. This is not peculiar to the eviction applications. Similar considerations come into operation even in the case of suits which are governed by the specific and detailed provisions of the Code of Civil Procedure regarding pleadings."

Thus, even where no such pleadings with regard to the rider so contained in section 13 have been made, but evidence to that effect has been led, then depending upon the facts and circumstances of each case, the same may not be treated as fatal, so as to lead to dismissal of the ejectment petition of the landlord.

The said view was further confirmed by the hon'ble Punjab and Haryana High court in 2013 (2) RCR (R) 230, whereby it has been held :-

"11. As far as the judgment that has been relied upon by the learned Counsel for the petitioners(tenants) is concerned regarding non mentioning of shops under ownership of landlord in his ejectment application, thereby making himself liable for concealment, the said judgment is not applicable to the facts and circumstances of the case in hand and is also distinguishable on the law point itself. It has been held by a Co-ordinate Bench of this Court in Banwari Lal v. Ram Parkash & Anr. 2009 (2) RCR (Rent) 160 that a landlord can always prove the ingredients of Section 13(3) of the Act in evidence and if it is shown that no prejudice is caused to the tenant on account of non pleading of Section 13(3) of the Act, then petition cannot be rejected. Thus, the strict proposition of pleading of the ingredients in an ejectment petition has been diluted to a larger extent and the landlord is at liberty to prove the ingredients of Section 13(3) of the Act in its evidence itself, if it is shown that no prejudice is caused to the tenant."

That though Rent controller and Appellate Authority, as constituted under the said Act, have powers to adjudicate the disputes between landlords and tenants, but they are not be treated as civil courts, as under CPC. They are merely to be treated as persona designata, under the Act, who are free to design their own procedure, and strict principles of Code of Civil Procedure are not applicable to them. It has been held so in Raghu Nath v. Romesh Duggal, (P&H) (D.B.) 1980 AIR (PB) 188 and Sawan Ram v. Gobinda Ram and anr. 1980 AIR Punjab 106 (FB).

While under the Act of 1949, no second appeal is provided, however under section 15 (5), the High Court may call for and examine the records relating to the proceeding under the said act. As a matter of fact, this power of the High Court is a Power of Revision. However, it has been held time and again by various Courts that the scope of interference under section 15 (5) is very limited and the said power cannot be exercised lightly to interfere. In Manmohan Sharma v. Smt. Swaran Kaur 2003 (1) PLR 300, it was laid down:

"21. Undoubtedly, findings of fact can be examined by the High Court under Section 15(5) of the Act in appropriate cases, but it must be remembered that the revisional court is not "a second court of first appeal". As noticed earlier, both the courts below have given concurrent findings of fact in accepting the bonafide need of the respondents to settle in India in the only house owned by them in Chandigarh. Mr. Sharma had laid considerable stress on the fact that need of the respondents could not be held to be bonafide as two petitions seeking similar relief had been dismissed earlier. The Appellate Authority has observed that the present rent petition was filed in the year 1999. It has also been observed that a lot of change can be seen with the passage of time between institution and disposal of the eviction petition on 21.11.1976 and 10.3.1982 and the dismissal of the appeal by the Appellate Authority on 9.3.1983. The health which respondent No. 1 was having in the year 1976 or 1982, she cannot be said to be enjoying in the year 1999. It has been observed that she has become pretty old, being 75 years of age and other respondent No. 2, landlord has undergone bye-pass surgery. Thereafter, the Appellate Authority relied on the observations of the Supreme Court in the case of Ramji Dass and another v. Ram Babu and another, 2000(1) R.L.R. 329. In the aforesaid case, the Supreme Court has observed as follows: -

"6. The High Court after examining the facts on this question found that the findings of the Courts below of reletting the accommodation after getting it vacated for the personal need in the year 1980 cannot defeat the bonafide need of the landlord for the year 1987.

7. High Court rightly considered the fresh need which was after the passage of seven long years between the last order and the present application made by the landlord by this passage of time the need has changed, his minor son has become major for whose need there was specific pleading and evidence was also led."

That with the passage of time the East Punjab Rent Restriction Act 1949, which was enacted at that point of time, in order to protect the interest of tenants who had migrated from Pakistan, has also been replaced by the Punjab Rent Act of 1995, which has come into force w.e.f. 30.11.2013 and as per section 75 of the 1995 Act, the East Punjab Urban Rent Restriction Act, 1949 (East Punjab Act No. III of 1949), stands repealed:

Provided that such repeal shall not affect,-

(a) the previous operation of the Act so repealed or anything duly done or suffered thereunder;

(b) any right, privilege, obligation or liability acquired, accrued or incurred under the Act so repealed;

(c) any penalty, forfeiture or punishment incurred in respect of any offence committed under the Act so repealed; and

(d) any investigation legal proceeding or remedy in respect of any such right, privilege, obligation, liability penalty, forfeiture,

and any such investigation, legal proceeding or remedy may be instituted, continued or enforced and any such penalty, forfeiture or punishment may be imposed as if the repealing Act had not been passed.

(2) Notwithstanding the repeal of the East Punjab Urban Rent Restriction Act, 1949 (East Punjab Act No. III of 1949), under sub-section (1), all cases and other proceedings in respect of the premises, other than owned by a non-resident Indian, let out prior to the commencement of this Act shall be governed and disposed of in accordance with the provisions of the Act so repealed.

Though with the coming of the new 1995 act the old act of 1949 stands explicitly repealed, yet the same is fully enforceable for all the exceptions carved out under section 75 of The Punjab Rent Act 1995.

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