GANGA RAM v. MOHAMMND USMAN — 1977 DIGILAW 143 (DEL)

T. V. R. TATACHARI ( 1 ) THIS Civil Revision Petition hasbeen filed under Section 25 of the Provincial Small Cause Courts Act (No. 9 of 1887) against the judgment and decree of Shri B. B. Gupta,judge, Small Cause Court, Delhi, dated 4/10/1972, in Suitno. 3343 of 1972. ( 2 ) THE said suit was filed by the respondent herein, Shri Mohd. Usman, for recovery of Rs. 561. 75 p. alleging that the petitioner herein,shri Ganga Ram, was a statutory tenant under him on a monthly rentof Rs. 60, and that the Municipal Corporation of Delhi assessed therateable value of the house No. 369 at Rs. 1,720 and imposed othercharges like water tax, scavanging tax, fire tax, etc. amounting tors. 111. 80 p. It was also alleged in the plaint that the petitioner (tenant) had sublet the premises in his tenancy to three persons whowere paying rent to him amounting to Rs. 78. 26 p. per month, thatthe said amount was taken into consideration by the Corporation indetermining the rateable value of the premises, and that the Corporation determined the rateable value on the basis that the premises indispute was fetching rent at the rate of Rs. 60 plus Rs. 78,26 p. Rs. 138. 26 p. It was submitted that the respondent (plaintiff) wasentitled under Section 121 (1) of the Delhi Municipal Corporation Actto recover from the petitioner (tenant) the difference between theamount of the property tax levied on the property and the amount oftax which would be leviable upon the premises if the said tax was calculated only on the amount of rent of Rs. 60 per month paid by thepetitioner (tenant) to the respondent without taking into considerationthe such of Rs. 78. 26 p. that was paid by the subtenants to the petitioner (tenant), that the respondent thus paid an extra sum ofrs. 561. 75 p. to the Municipal Corporation for the period 1969to 1972, and that he was entitled to recover the same from the petitioner. The petitioner (tenant) contested the suit raising various pleas. ( 3 ) THE suit was heard by Shri B. B. Gupta, Judge, Small Causecourt, Delhi. The respondent had earlier filed a similar suit forrecovery of extra tax from the petitioner (tenant) for an earlier period,and the same was decreed. The petitioner (tenant) contested the suit raising various pleas. ( 3 ) THE suit was heard by Shri B. B. Gupta, Judge, Small Causecourt, Delhi. The respondent had earlier filed a similar suit forrecovery of extra tax from the petitioner (tenant) for an earlier period,and the same was decreed. A Civil Revision was preferred TO by thepetitioner (tenant) to this Court against the said judgment and decreeand the same was dismissed by the judgment which has been markedas Exahibit P. 4 in the present suit. Observing that a perusal of thesaid judgment shows that the same pleas were taken by the petitiofier (tenant) in the said earlier suit and had been overruled by the Highcourt, the learned Subordinate Judge decreed the present suit. Thepetitioner (tenant) has filed the present Civil Revision Petition againstthat judgment and decree. ( 4 ) THE present Civil Revision came up for hearing before B. C. Misra J. in the first instance. The Learned Judge considered thatthe provision involved the interpretation of Section 121 of the Delhimunicipal Corporation Act and, therefore, the Municipal Corporationof Delhi should be heard. He accordingly issued notice to the Corporation to show cause why it should not be impleaded in the Revision. It appears from the record that though the learned Judge did notsubsequently pass any order impleading the Corporation, Mr. C. L. Chaudhry, Advocate, entered appearance for the Corporation and washeard by the learned Judge at the time of the hearing of the Revisionpetition. After hearing the counsel for the petitioner and the respondent, and Mr. Chaudhry for the Corporation, the learned Judge notedthat while Section 7 (2) of the Delhi Rent Control Act provides thatthe landlord shall not recover from the tenant, by increase in rent orotherwise, the amount of any tax on building or land imposed in respectof the premises occupied by the tenant. Section 121 (1) of the Delhimunicipal Corporation Act enables the landlord to recover from thetenant any excess of the amount of house tax which has been leviedon the building and which is in excess of the amount which would beleviable on the amount of contracted rent received from the tenant, andthat there was thus a conflict between Section 7 (2) of the Rent Actand Section 121 (1) of the Corporation Act. The learned Judge alsoobserved that in Ganga Ram v. Mohd. The learned Judge alsoobserved that in Ganga Ram v. Mohd. Usman, I. L. R. 1971 (1) Delhi639 (1), H. R. Khanna C. J. (as his Lordship then was) held thatsection 121 (1) of the Corporation Act would prevail upon Section7 (2) of the Rent Act, while a Division Bench of this Court, S. N. Andley C. J. and S. N. Shankar J. , held in Sunderdass Tola Ram andothers v. Municipal Corporation of Delhi, C . M (M) No. 197 of1971 (2), decided on 26/03/1973, that the right given by Section 121 (1) of the Delhi Municipal Corporation Act was set at naughtby Section 7 (2) of the Delhi Rent Control Act, and that the provisionsof the Rent Act prevailed, it being a later and special statute. "thelearned Judge further observed that the decision of H. R. Khanna, C. J. was not noticed by the- Division Bench. In the circumstances, thelearned Judge considered that the questions involved in the case needto be decided by a larger Bench. ( 5 ) THE learned Judge indicated the following two questions as arising for determination in the Revision :- " (1) Whether the Municipal Corporation of Delhi can fix theannual rateable value at a figure higher than the amountof rent paid by the tenant to the landlord by taking intoconsideration the amount of rent paid by the subtenantsto the tenant and (2) If so, whether the landlord is entitled to recover undersection 121 of the Corporation Act the enhanced amountof house tax from the tenant notwithstanding the contractof tenancy and the provisions of sub-section (2) of Section7 and 4 of the Delhi Rent Control Act ?"the Civil Revision Petition then came up before two of us (T. V. R. Tatachari, C. J. and Yogeshwar Dayal, J.) on 23/03/1977, andit was directed to be posted for hearing by a Full Bench of threejudges. That is how the Civil Revision Petition has now came upbefore us. ( 6 ) IT is not clear from the order of the learned single Judge as to whether he wanted to refer only the two questions or the entire Civilrevision Petition to the larger Bench. However, the learned counselfor the parties are agreed before us that the entire Civil Revisionpetition may be treated as REFERRED TO for decision by us. ( 6 ) IT is not clear from the order of the learned single Judge as to whether he wanted to refer only the two questions or the entire Civilrevision Petition to the larger Bench. However, the learned counselfor the parties are agreed before us that the entire Civil Revisionpetition may be treated as REFERRED TO for decision by us. ( 7 ) SO far as the first question is concerned, it cannot be permitted to be raised and decided in the present case as the suit, as framed,was only for recovery of the excess tax amount from the tenant. Thelearned counsel for the petitioner (tenant) submitted that he wouldlike to challenge the levy of the tax also and the first question mayalso be considered by us. In our opinion, he cannot be permitted todo so because the validity of the levy of the tax by the Corporationtaking into consideration the rent paid by the subtenants to the tenantconcerns the Corporation, but it was not made a party to the suit filedby the landlord. If the tenant wants to question the validity of thelevy, he has to do so by an appropriate proceeding making the Corporation a party. It is true that notice was issued by the learned singlejudge to the Corporation in this Civil Revision Petition and Mr. C. L. Chaudhry appeared for the Corporation. Yet, his appearance was onlyin response to the notice issued by the learned single Judge in therevision, and it would be unfair to the Corporation to add it as aparty for the first time in this Revision Petition and decide the validityof the levy without giving it a proper opportunity to file a regularpleading in writing regarding the same. We, therefore, informed thecounsel that we will not consider and decide the first question. ( 8 ) AS regards the second question, it is necessary to refer to Section 121 (1) and (3) of the Delhi Municipal Corporation Act and Section7 (2) of the Delhi Rent Control Act, 1958. They read as follows :-121. We, therefore, informed thecounsel that we will not consider and decide the first question. ( 8 ) AS regards the second question, it is necessary to refer to Section 121 (1) and (3) of the Delhi Municipal Corporation Act and Section7 (2) of the Delhi Rent Control Act, 1958. They read as follows :-121. Apportionment of liability for property taxes when thepremises assessed are let or sublet- (1) If any land or building assessed to property taxes is let,and its rateable value exceeds the amount of rent payable in respect thereof to the person upon whom underthe provisions of Section 120 the said taxes are leviable,that person shall be entitled to receive from his tenantthe difference between the amount of the property taxeslevied upon him and the amount which would be leviable upon him if the said taxes were calculated on theamount of rent payable to him. ( 9 ) A perusal of the above provisions shows that while Section21 (1) of the Delhi Municipal Corporation Act, 1957, enables thelandlord to recover from the tenant the excess tax levied OH a buildng let out to the tenant, the second part of Section 7 (2) of the Delhilent Control Act, 1958, precludes him from recovering from the tenantmy tax imposed in respect of the premises in the occupation of theenant. The question for consideration is as to whether these two provisions are in conflict with each other. ( 10 ) IN Ganga Ram v. Mohd. Usman (supra), H. R. Khanna C. J. onsidered this question and rejected a contention urged before him thatas the Delhi Rent Control Act, 1958 (59 of 1958) is a later enactment compared to the Delhi Municipal Corporation Act, 1957 (66 of1957), the provision in the Delhi Rent Control Act should have ancoverriding effect. Usman (supra), H. R. Khanna C. J. onsidered this question and rejected a contention urged before him thatas the Delhi Rent Control Act, 1958 (59 of 1958) is a later enactment compared to the Delhi Municipal Corporation Act, 1957 (66 of1957), the provision in the Delhi Rent Control Act should have ancoverriding effect. The learned Chief Justice pointed out that the barcreated by the second pan of Section 7 (2) of the Delhi Rent Controlact pertains to "normal tax on the building" occupied by the tenant,while Section 121 (1) of the Delhi Municipal Corporation Act "dealswith the contingency where the property tax levied for the tenantedpremises is more than the amount which would have been levied hadthe assessment been made on the basis of the rent payable by thetenant to the landlord", and that "as Section 121 is an enactmentdealing specially with that particular contingency", its provision wouldhave an overriding effect on the basis of the well established principlethat "a special provision should be given effect to the extent of. itsscope, leaving the general provision to control cases where the specialprovision does not apply" as enunciated in South India Corporation (P)Ltd. v. Secretary, Board of Revenue, Trivandurm and another, A. I. R. 1964 S. C. 207 (3 ). The learned Chief Justice observed that "the factthat the Delhi Rent Control Act was enacted in time subsequent tothe enactment of the Delhi Municipal Corporation Act would notmake much material difference". He further observed that apart fromthe above, he was of the view that the provisions of Section 7 (2) ofthe Delhi Rent Control Act were not attracted to the case before himas those provisions dealt with tax on building or land imposed in respect of premises "occupied by the tenant", while in the case before him,as in the present case before us. the tenant of the premises in disputehad "ceased to occupy" portion of the premises which have beensublet by him. With respect, we are in complete agreement with thereasons given by the learned Chief Justice as well as with his viewthat Section 121 (1) of the Delhi Municipal Corporation Act has anoverriding effect over the provision in Section 7 (2) of the Delhi Rentcontrol Act. ( 11 ) WE have, however, to consider the decision in Sunderdass Tola Ram and others v. Municipal Corporation of Delhi (supra ). In thatcase, until the financial year 1969-70. ( 11 ) WE have, however, to consider the decision in Sunderdass Tola Ram and others v. Municipal Corporation of Delhi (supra ). In thatcase, until the financial year 1969-70. the building in question wasassessed to house tax on an annual rateable value of Rs. 50,240. Injuly, 1970, the Assistant Assessor and Collector of the Municipal Corporation of Delhi proposed to increase the rateable value from Rs. . 50,240 to Rs. 61,500, with effect from 1/04/1970, on the groundthat there were additions to the building and changes in the rent. Theowners-landlords of the building filed their objections to the said proposal, stating that there had been no increase in the rent which wasbeing recovered by them from the tenants, and that some of the tenantshad made unauthorised constructions in the said building without thepermission of the owners-landlords or of the Building Department ofetc. Municipal Corporation. The Deputy Assessor and Collector madea verification at the site and confirmed that the owners-landlords weregetting the same rent as before from the various tenants. He, however,took the view that by reason of the unauthorised constructions madeby the tenants, the accommodation and the property had gone up andso should be the rental value. In that view, he increased the annualrateable value to Rs. 57,890. ( 12 ) THE owners-landlords preferred TO an appeal to the Additionaldistrict Judge, Delhi, but the same was dismissed. They then filed apetition in the High Court under Article 227 of the Constitution ofindia praying that the enhancement of the rateable value may bequashed as being illegal and void. The petition was heard by a Divisionbench of this Court, S. N. Andley C. J and S. N. Shankar J. The Division ench held firstly that under section 124 (3) of the Delhi Municipal Corporation Act, notice had to be given to the owner or to anylessee or occupier of the building when the rateable value of the building was sought to be increased, but that no notice of the proposed increase was given by the Corporation to any of the tenants who hadmade the unauthorised constructions on the basis of which the annualrateable value was proposed to be increased, and that in the absence ofsuch notice no increase could be made. The Division Bench thenobserved that in that view of the matter, a contention urged on behalfof the Corporation that even if the annual rateable value was increasedwithout giving notice to the tenants, the owners-landlords could nothave any complaint as they could recover the additional tax from thetenants undersection 121 (1) of the Delhi Municipal Corporation Act,as well as the contention in reply by the owners-landlords that byreason of Section 7 (2) of the Delhi Rent Control Act. the additionaltax on the building could not be recovered by them from the tenants,did not fall for determination. Yet, the Division Bench considered theconflict between Section 121 (1) of the Corporation Act and Section7 (2) of the Rent Control Act, and held that the Delhi Rent Controlact is a later and special statute dealing with the rights and liabilitiesbetween landlords and tenants, and, therefore, the Delhi Rent Controlact would prevail over the Corporation Act as held by the Supremecourt in Asa Ram v. The District Board, Muzaffarnagar, AIR 1959supreme Court 480 (4), where the Supreme Court Approved the following observation in King v. Justices of Middlesex, (1831) 2 B and Ad. 818 (5)- "where two Acts of Parliament which, passed during the samesession and were to come into operation the same day,are repugnant to each other, that which last received theroyal assent must prevail and be considered pro tanto arepeal of the other. "in that view, the Division Bench expressed its opinion that the rightgiven by Section 121 (1) of the Corporation Act to the landlords wasset at naught by Section 7 (2) of the Rent Control Act. ( 13 ) WITH due respect, we are unable to agree with the aboveopinion of the Division Bench. In the first place, the said opinion wasan obiter dictum. In the second place, the reason given by thedivision Bench for its view, namely, that the Rent Control Act wasa later and special statute was not correct. The Delhi Municipalcorporation Act was enacted in 1957. At that time, the Delhi andajmer Rent Control Act, 1952 (38 of 1952) was in force. It contained a provision in Section 6 thereof in terms identical with theprovision in Section 7 (2) of the Delhi Rent Control Act, 1958. Itis not, therefore, correct to proceed on the basis that Section 7 (2) ofthe Delhi Rent Control Act, 1958, was a later provision. It contained a provision in Section 6 thereof in terms identical with theprovision in Section 7 (2) of the Delhi Rent Control Act, 1958. Itis not, therefore, correct to proceed on the basis that Section 7 (2) ofthe Delhi Rent Control Act, 1958, was a later provision. Further,as pointed out by H. R. Khanna, C. J. in Ganga Ram v. Mohd. Usman (supra), the bar created by the provision in the Rent Control Actpertains to "normal tax on a building" occupied by a tenant, whilesection 121 (1) of the Corporation Act deals with the particular contingency where the property tax levied for the tenanted premises ismore than the amount which would have been levied had the assessment been made on the basis of the rent payable by the tenant tothe landlord. Thus, the provision in the Delhi Municipal Corporationact was the later and special provision, and it would not be correct toproceed on the basis that the provision in the Rent Control Act is alater and special provision, while in fact Section 121 (1) of the Corporation Act is a later and special provision. The decision in Gangaram v. Mohd. Usman (supra) does not appear to have been broughtto the notice of the Division Bench which had, therefore, no occasionto consider the reasons given by H. R. Khanna C. J. in the case ofganga Ram (supra ). For all the above reasons, we are of the opinion that the view expressed by the Division Bench regarding the conflict between Section 121 (1) of the Corporation Act and Section 7 (2)of the Rent Control Act cannot be accepted as laying down the correctlaw. ( 14 ) FOR the foregoing reasons, our answer to the second questionmentioned by B. C. Misra J. is in the affirmative and we accordinglyhold that the landlord is entitled to recover under section 121 (1) ofthe Corporation Act the enhanced amount of house tax from the tenantnotwithstanding the contract of tenancy and the provisions of Section7 (2) and Section 4 of the Delhi Rent Control Act. No other pointor question was urged before us in the Civil Revision Petition. Civil Revision Petition No, 418 of 1972, therefore, fails and is dismissed, but in the circumstances without costs.