THE CANTONMENT BOARD, AMBALA v.

PYARELAL March 12, 1965

[K. N. WANCHOO, J. R. MUDHOLKAR, ANDS. M. SIKRI, JJ.)

Cantonments Act (2 of 1924), ss. 256, 257 and 259-Scope of.

In 1954, the words "rent on land or buildings" were added to s. 250 of the Cantonments Act, 1924. After the amendment, the appellant (Cantonment Board), applied under the section to the concern ed Magistrate, for realisation of arrears of rent from the respondent, on the basis of a lease in his favour. The Magistrate issued warrants for attachment of the movable property of the respondent. The respondent went in revision to the Sessions Judge. He made a reference to the High Court and the High Court set aside the Magistrate's order. In its appeal to the Supreme Ccurt, the appellant contended that, upon a correct interpretation of the section, the Magistrate had the power to order the recovery of rent due to the appellant.

HELD : (Per Wanchoo and Sikri JJ.): The rent was not claimable by the appellant under the Act or the Rules but only under the lease in favour of the respondent. Therefore, s. 259(1), in so far as it refers to recovery of such rent by application to Magistrate, would not apply.

In view of the provisions of the Act, Ca!ltonment Property Rules, 1925, and the Cantonment Land Administration Rules, 1937, a Cantonment Board has power, to manage the lands or buildings vested in it or entrusted to its management, to lease them out and to fix rents therefor. But s. 259 can be utilised for realisation of arrears of rent on land and buildings, only if such rent is recoverable by a Board or a Military Estates Officer under the Act or the Rules made thereunder. The word "recoverable" means "claimable". Section 257 read with s. 256 is an example of the Bo; rd's power to claim rent from the tenant of an owner. There may be other such cases, and it is only in those cases, where the Act or the Rules, in terms, make the rent on land and buildings claimable by the Board, that the section will apply. But where the liability arises purely on the basis of a lease between the Board and the tenant, nothing in the Act or the Rules, particularly after r. 42 which provided for such recovery had been repealed, makes such rent claimable by the Board under the Act or the Rules. Since the repeal was in 1940 before the section was amended, it cannot be argued that the rule was repealed because of the amendment of the section. [344 F-H; 346 F-H] The view taken, however, would not affect the right of the Board to recover by suit, under the general law, rent of its land and buildings given by it on lei'se. [347 B]

Per Mudholkar, J. (dissenting): The High Court was in error in setting aside the order of the Magistrate.

What the expression "recoverable by a Board or a Military Estates Officer under the Act or the Rules made thereunder," in s. 259 means is, what the Act or the Rules permit the Board to recover, or what the Act or the Rules permit the Military Estates Officer to recover. The words "recoverable by" and "under this Act of the Rules made thereunder." are meant to govern "a Board" or "a Military Estates Officer." Thus under the section the power to recover money is exercisable by such of these two authorities as performs the duty or exercises the power by reason of which the liability of another

342 SUPREME COUR'r REPORTS (1965] 3 s.c.R.

to pay the tax, rent or.any other money arises. Powers are conferred upon a Board under the Act read with the Cantonment Land Administration Rules, 1937. to let out property vested in it or which is under its management. Where, in exercise of those powers the Board has let out any land or buildings, it has the right as well as the duty to collect the rent from the tenant. Therefore, where the liability to pay money arises against a person, by reason of something done by the Board or the Military Estates Officer, in exercise of a power or the performance of a duty under the Act, that liability can be enforced by the authority concerned, either by instituting a suit or by making an application to a Magistrate. But if the word "rent" is confined to money due under some express provision of the Act or Rules, it will lead to the curious result, that, in respect of land or buildings under the management of the Board, neither remedy would be available-though the claim for rent is ultimately traceable to those provisions of the Act and the Rules which empower the Beard to let out the land or buildings-upon the ground that it cannot be said to be claimable or recoverable under any express provision of the Act. [350 C-E; 351F; 351 G-H]

Further, if the meaning of the word "rent" is so restricted, that word itself would be rendered otiose, because, there is no provision whatsoever in the Act which expressly makes rent claimable or recoverable by e; ther of the two authorities specified therein. What the Board recovers under ss. 256 and 257 cannot be regarded as rent, giving the word its dictionary meaning, for, the Board is not the landlord of the occupier, and what it recovers from him, is not something which was due to the Board as rent .from him., [352 E-G].

CRIMINAL APPELLATE JURlSDICTION: Criminal Appeal 151 of 1963.

Appeal by spec; al leave from the judgment and order dated March 27, 1962 of the Punjab High Court in Criminal Revision No. 1137 or 1961.

Gopal Singh, for the appellant.

The respondent did not appear.

The Judgment of Wanchoo and Sikri JJ. was delivered by Wanchoo J. Mudholkar J. delivered a dissenting opinion.

Wanchoo, J .. This appeal by special leave raises the question 6 of the interpretation of s. 259 of the Cantonments Act, No. 11 of 1924, (hereinafter referred to as the Act). The respondent was a tenant of the appellant. An ai; pl'cation was made by the Cantonment Executive Officer, Ambala, on January 7, 1960, for realisation of a sum of Rs. 649.50 from the respondent under s. 259 of the Act on the ground that the amount was due as arrears of rent H on the basis of a lease in favour of the respondent. The respondent apparently questioned the jurisdiction of the magistrate to realise the amount. The magistrate held that he had jurisdiction and issued warrants for attachment of the movable property of the respondent on June 13, 1961. Thereupon the respondent went in revision to the Sess; ons Judge Ambala contending that the magistrate had no jurisdiction to realise the arrears of rent due under a lease

CANTONMENT llOARD AM BALA v. PY ARELAL ( w anchoo, J.) 343

under s. 259 of the Act and in any case that could not be done without taking into account the objections of the respondent. The Sessions Judge following certain earlier decisions of the Lahore High Court took the view that rent under a lease could not be recovered under s. 259 of the Act and made a reference to the High Court under s. 439 of the Code of Cr; minal Procedure. The High Court heard the reference and accepted the view of the Sessions Judge and set aside the order of the magistrate dated June 13, 1961.

The High Court having refused the certificate, the appellant obtained special leave from this Court; and that is how the matter has come up before us.

Two questions have been raised by learned counsel for the appellant in this appeal. In the first place, he urges that the magistrate when he is acting under s. 259 of the Act is a persona designata and therefore his order is not revisable under ss. 435 i 439 of the Code of the Criminal Procedure. The Sessions Judge and the High Court therefore had no jurisdiction to interfere with that order under ss. 435 I 439 of the Code of Criminal Procedure.

Secondly, it is urged that the v'ew taken by the High Court that arrears of rent due under a lease cannot be recovered under s. 259 of the Act is incorrect.

The question as to the jurisd'ction of the Sessions Judge and High Court was never raised before the appeal in this Court.

Learned counsel, however, relies on the Dargah Committee, Aimer

v. State of Rajasthan (') in support of his contention that the magistrate acting under s. 259 of the Act acts as a persona designata and therefore his order under that section is not revisable under ss. 435 / 439 of the Code of Criminal Procedure and the Sessions Judge and the High Court had no jurisdiction under those provisions to interfere with -such an order. The case cited on behalf of the appellant certainly supports the contention put forward; but in the circumstances of this case we are not prepared to allow this contention to be raised at this stage. It is true that a question of jurisdiction, not depending upon facts to be investigated, can be allowed to be raised at any stage. Ordinarily if we were satisfied that the High Court had no jurisdict:on at all to interfere we would have allowed this cuestion to be raised even at this late stage. But we are of opinion that though the High Court may not have jurisdiction to interfere under ss. 435 I 439 of the Code of Criminal Procedure it could certainly interfere w'th the order of the magistrate under Art. 227 of the Constitution. Now if this point had been raised before the High Court it may very well be that the High Court might have considered the reference as if it was an application before it under Art. 227 of the Const'tution, in which case the High Court would have jurisdiction to interfere with the order or the magi.strate if it came to the conclusion that the magistrate had

(') [I962J 2 s.c.R. 265.

SuPREME COURT REPORTS

(1965] 3 S.C.R.

no jurisdiction in. such circumstances under s. 259 of the Act. In these circumstances we are not prepared to permit the appellant to raise this point before us at this late stage.

This brings us to the interpretation of s. 259 of the Act as it stood after ame'!dment by Act II of 1954. The relevant part of the section now reads as follows: -

"Notwithstanding anything elsewhere contained in this Act, arrears of any tax, rent on land and buildings and :my other money recoverable by a Board or a M; litary Estate Officer under this Act or the rules made thereunder may be recovered together with the cost of recovery either by a suit or. on application to a Magitrate having jurisdiction in the cantonment or in any place where the person from whom such tax, rent or money is recoverable may for the time being be residing, by the distress and sale of any movable property of, or stand'ng timber, or growing crop belonging to such person which is within the limits of such magistrate's jurisdiction, and shall if payable by the owner of any property as such, be a charge on the property until paid; provided.

(2) * * * * " The first question that arises is whether rent on land and bu'ldings mentioned in the sect'on is governed by the words "recoverable by a Board or a Militarv Estates Offioer under this Act or

the rules made thereunder". There is no doubt that "any tax" and "any other money" mentioned in the section are governed by the F words "recoverable by a Board etc." It seems to us that the words "rent on land and buildings" wh'ch appear between the words "any tax" and "any other money" must equally be governed by the words "recoverable by a Board etc." Therefore the provisions of s. 259 of the Act can be utilised for realisation of arrears of rent on land and buildings onlv if such rent is recoverable by a G Board or a Militarv Estates Officer under the Act or the rules made thereunder. The word "recoverable" in the context obviously means "claimable". for s. 259 itself provides for the manner of recovery. Therefore action for recovery can be taken under s. 259 w'th respect to rent on land and buildings provided such rent is claimable by a Board under the Act or the rules framed thereun- H der. This view was taken by the Lahore High Court in Banarsi Das

v. Cantonment Authority Ambala Cantonment(') and is in our opinion correct. It may be added that in 1938. the words "rent on land and buildings" and •'Under the rules" did not appear in s. 259 . . Even so. the Lahore High Court fook the view with respect to the section as 't then stood that the money to be recovered under s. 259 must be claimable by the Board under the Act.

(1) A.LR. 1933 Lah. 517.

CANTONMENT BOARD AMBALA v. PYARELAL (Wanchoo, J.) 345

The next question that arises is whether "rent on land and buildings" on lease can be said to be claimable by the Board "under the Act or the rules. made thereunder". It is urged on behalf of the appellant that cl. (p) of s. 116 of the Act provides for "maintaining and developing the value of property vested in, or entrusted to the management of the Board'', ands. 116-A gives the Board power to manage any property entrusted to its management by the Central Government on such terms as to the sharing of rents and profits accruing from such property as may be determined by rule. Further reliance is placed on the Cantonment Property Rules, 1925. Rule .8 thereof provides that immovable property which vests in and belongs to the Cantonment Authority may be leased by the Cantonment Authority without a premium on the condition that a reasonable rent is reserved and made payable during the whole term of the lease and that the lease or the agreement for the lease is not made without the previous sanction of the Cantonment Authority by resolut'on at a general meeting, or the Officer Commanding in Chief of the Command or the Government of India as the case may be. It is urged that these provisions of the Act and the Rules show that the Board has the power to claim rent .thereunder in respect of the leased property. Reliance is further placed on the Cantonment Land Administration Rules 1937 which provide how rents would be fixed when land is leased out by the Cantonment Authority. Rule 4 of these Rules prov'des for classification of land and r. 8 for standard table of rents; r. 9 (6) vests the management of class 'C' land in the Board; r. 26 provides for disposal of land by private agreement; r. 28 for execution of leases, rr. 29 and 30 for maintenance of grants registers of building sites; r. 31 for leases for special periods and on special terms; r. 32 for agricultural land leases; r. 34 for record of agricultural leases; r. 35 for execution of agr'cultural leases; r. 37 for leases for miscellaneous purposes and r. 41 for special conditions in leases. lt may be mentioned that originally there was a rule (r.42) in these terms:-

"Recovery of arrears-All arrears of rent and other G payment under these rules together with interest on such arreas at the rate of seven and a half per cent per annum from the date when they become due to the date of their realisation, shall, on the application of the person spec'fied in sub-section (2) of section 259 of the Act, or of the Military Estates Officers, as the case may be, recoverable H in the manner provided in that section."

That rule however no longer exists as it was repealed in 1940.

There is no doubt that in view of the provisions of the Act, the Property Rules and the Land Administration Rules to which we have referred above, the Board has the power to manage lands

l'J A r R. 19~~ tali . .517,

(1965) 3 B.C.R,

and Buildings vested in ; t or entrusted to its management, lease A them out and fix rents therefor. But the right of the. Board to claim the rent on land and buildings does not arise from these provisions under the Act ljnd the Rules referred to above. The right of the Board to claim rent only arises after the execution of the lease.

Therefore rent on land and buildings is not claimable by the Board under the provisions of the Act or the Property Rules or the Land B Adm'nistration Rules but under the lease. It follows therefore that s. 259 (I) cannot be applied to a simple case of money due to the Board on a contract of lease.

It is however urged on behalf of the appellant that the words "rent on land and buildings" which were added by the 1954c Amendment refer to something of that kind which is recoverable under s. 259 as , atherwise the amendment would be meaningless.

That is undoubtedly so. We find however, that s. 256 provides that in the event of. non-compliance with the terms of any notice, order or requisit'on issued to any person under this Act, or any rule or bye-law made thereunder, requiring such person to execute any D work or to do any act. it shall be lawful for the Cantonment Authority after giving notice in writing to such person, to take such action or such steps as may he necessary for the completion of the act or work required to be done or executed by him, and all the expenrcs incurred on such account shall be recoverable by the Cantonment Authority. Section 257 then provides that if any such notice as is E .referred to in s. 256 has been given to any person in respect of property of which he is the owner. the Cantonment Authority may require any occupier of such property or of any part thereof to pay to it, instead of to the owner, any rent payable by him in respect of such property, as it falls due, upto the amount recoverable from the owner under s. 256 and it further provides that any F amount recovered from any occupier ; nstead of from an owner under sub-s. (I) shall. in the absence of any contract between the owner and the occupier to the contrary, be deemed to have been paid to the owner. Here at any rate we have an example of the Board's power to claim rent from a tenant of an owner under s. 257 of the Act read with s. 256. So it cannot be said that there is no G case where the Act does not provide for claim of rent by the Board.

We may add that there may be other cases like this either under the Act or under the Rules. In our view it is in such cases where the Act or the Rules in terms make the rent on land and build'ngs claimable by the Board. that s. 259 will apply. But where the liability to pay rent arises purely on the basis of a lease between the H Board and the tenant. nothing in the Act or the Rules has been brought to our notice, particularly after r. 42 referred to above has been repealed, which makes such rent claimable by the Board under the Act.or the Rules. We may add r. 42 was repealed long before 1954 when the words "rent on land and buildings" came ins. 259.

So it cannot be argued that the omiss'on of r. 42 was due to the amendment of 1954.

CANtONMENT BOARD AMBALAV. PYARELAL (Muahclbr, J.) 3'17

It is urged that the section provides for recovery by suit also and as such it will not be possible for the Board to recover rent of land and buildings let out by it even by suit if the rent in the section refers only to rent directly claimable under the Act or the Rules. This jg clearly 'ncorrect. The section does not bar the right of the Board as an owner or holder of land and buildings to take action for recovery of rent thereof by suit under the general law of the land. Further by providing for recovery of rent of the kind we have indicated above by suit or by application rent of the kind we have indicated above by suit or by application . to a magistrate the section does not affect the right of the Board to recver rent of its land and buildings by suit for such rents are entirely outs'de the section and the right of the Board under the general law of the lc; nd is not taken away by the section. It may be that the sction provided for recovery by suit as an alternat:ve as a matter of ab1ndant caution to avoid an argument that the application to a magistrHe ws the only means open to the Board for recovery of sums covered by the section. In any case the view we are taking will not affect the right of the Board to recover by suit under the general law rent of its land and build'ngs given on lease.

In the circumstances we agree with the High Court that the rent in this case was not claimable by the Board under the Act or the Rules but only under the lease in favour of the respondent.

Therefore s. 259 (!) insofar as it refers to recovery of such rent by application to a magistrate will not apply.

In the circumstances the appeal fails and is hereby dismissed.

Mudholkar, J. The question which falls for a determination in this appeal is whether under s. 259 of the Cantonment Act. No. II of 1924 '1 ent' on land or buildings under the management of the Cantonment Board can be recovered thereunder by a Magistrate.

This question was raised by the respondent in a revision application made by him before the Sessions Judge under s. 435 of the Code of Criminal Procedure against the order of the Magistrate, II Class, made under the afoesaid prov'sion upon an application made to him by the Executive Officer, Ambala Cantonment for the recovery of Rs. 649.50 nP being the arrears of rent alleged to be due from the respondent to the Cantonment Board. The learned Sessions Judge made a reference to the High Court under s. 438 of the Code of Crimiml Procedure on the uthority of the decisions in Municipal Committee, Delhi v. Hafiz Abdullah(') and Gurandit1a Ma' v. Em.?eror ('). The High Court. after referring to these cases and to Banarsi Das v. Cantonment Authority, A mba/a Cantonment(') accented the reference and set aside the order of the Magistrate. By special leave the Cantonment Board has come up to this Court in <!ppeal

{t) ,\.I l"t u1i Lall G'.10

111.) A.IR. T 8 ~.'th. ~\l.

(~J A.1.!L (~:t;~ J, nh. ; J.

348 SUPREME COURT REl'ORTS [1965) 3 s.C.R.

. Two points were.urged by Mr. Gopal Singh appearing for the appellant. The first is that the proceeding before the Magistrate was not one under the Code of Criminal Procedure (Ind, therefore, neither could a reference be made by the Sessions Judge to the High Court under s. 438. Cr. P.C. nor could an order be made by the High Court under s. 439. The second point is that upon a correct interpretation of s. 259 of the Act the Magistrate had the power to recover the rent due to the appellant in the manner provided for in the section. We did not .allow the first contention to be raised for two reasons. In the first place the point was not raised in the High Court and in the second place it would not be fair to the respondent who is ex parte to have the appeal decided upon a new ground altogether.

In so far as the second point is concerned it seems to me that the contention of Mr. Gopal S; ngh is correct and that the High Court was in error in setting aside the order of the Magistrate. The two cases upon which reliance was placed before the High Court arose unaer s. lSI of the Punjab Municipal Act (Ill of 1911) whicll runs thus:

"Any arrears of any tax, water-rate, rent, fee or any other money claimable by a committee under this Act may be recovered on an application to a Magistrate." According to the Lahore High Court the operat; on of this section was controlled by the words "claimable by a committee under this Act" and that it was not any sum that could be described as rent or fee which could be recovered under summary provisions of that section. According to that High Court only a sum that was claimable by the Committee under the express provisions of that Act could be recovered by resort to summary procedure provided by that section. In Banarsi Das's case(') it was similarly held that the expression "recoverable by the Cantonment Authority under the Act" did not include money due under an ordinary contract between the Cantonment Authority and others and that s. 259 of the Act applied only to such monies as were recoverable by that authority under express provisions of the Act. It is this last decision which was relied upon by the High Court and it pointed out that though the word rent did noJ occur in s. 259 of the Act as it stood when Banarsi Das's case(') was decided the introduction of that word had not altered the position in so far as recovery of rent is concerned.

Section 259 of the Act as it now stands runs thus:

"Notwithstanding anything elsewhere contained in this Act, arrears of any tax, rent on land and buildings and any other money recoverable by a Board or a Military Estates Officer under this Act or the rules made thereunder may be recovered together with the cost of recovery

(') A.LR. 1938 L, h. 517.

CANrONMENTBOARD AMBALAV. PYARELAL(Mudhdkar, J.) 349

either by a suit or on application to a Magistrate having jurisdiction in the cantonment or ; n any place where the person from whom such tax, rent or money is recoverable may for the time being be residing, by the distress and sale of 11ny movable property of, or standing timber or growing crop belonging to such person which is within the limits of such magistrate's jurisdiction, and shall, if payable by the owner of any property as such, be a charge on the property until paid for." Then there is a proviso which need not be guoted. The aforesaid section deals with "Method of recovery". It sets out two methods: one is institution of a suit and the other is making of an application to a Magistrate. Therefore, where rent of land or building under the; management of the Cantonment Authority falls to be recovered resort could be had either to a suit or to summary, proceeding as provided in the section. But if the expression "rent" is confined to money due under some express provision of the Act it will lead to a curious result. Thus in respect of rent of land or buildings under the management of the Board ne'ther remedy would be available-though the claim for the rent is ultimately traceable to those provisions of the Act and the Rules which empower the Board to let out the land or buildings--upon the ground that it cannot be said to be claimable or recoverable under any express provision of the Act. Surely the Legislature could never have meant that even a suit for recovery of rent would be maintainable at the ; nstance of the Board only if it was for the purpose of recovery of rent from a tenant who was liable under an express provision of the Act or the Rules to pay rent to the Board. Under ss. 116 and l 16A of the Act. read along with Cantonment Land Administration Rules, 1937, the Cantonment Board is entrusted with certain duties and is empowered to do certain acts in relation to the Cantonment property under its management. It is the duty of the Board. among other things, to mainta; n and develop the property vested in or entrusted to its management. Section 116-A provides as follows:

"A Board may, subject to any conditions imposed by the Central Government, manage any property entrusted to its management by the Central Government on such terms as to the sharing of rents and profits accruing from such propertv as may be determined by rules made under section 280." The Cantonment Land Administration Rules, 1937 contain detailed provisions as to the leasing of land, standardisation of rents, disnosal of land bv a private agreement. execution of leases etc.

Powers are thus conferred upon the Board to let out property vested in it or which is under ; ts manageme!"lt. It would follow from this that where in exercise of these powers the Bord has let out anv land or buildings it has the right as well as the duty to collect the rent from the tenant. Therefore, though, strictly speaking, the

[1965] 3 S.C.R.

rent due from the tenant cannot be said to be payable under any A express provision of the Act the tenant's liability to pay and the Board's right to recover it is ultimately traceable to the Act inasmuch as this liability has arisen by reason of tlie exercise of a power exercised or performance of duty by the Board under express provisions of the Act and the Rules. Surely the Board cannot be deprived of the right to recover the rent or be absolved B from the duty to recover it by resort to the normal remedy of suit.

Yet upon the interpretation placed upon s. 259 of the Act by the Lahore High Court and by the Court below a suit as well as a proceeiing before a Magistrate have to be placed on the same foot; ng.

This will lead to an impossible position and it cannot for one moment be thought that this is what the Legislature had intended.

C What the expression "recoverable by a Board or the Military Estates Officer under this Act or the rules made thereunder" means is what the Act or the Rules permit the Board to recover or what the Act or the Rules permit the M; litary Estates Officer tci recover.

To put it in another way the words "recoverable by" and "under this Act or the Rules made thereunder" are meant to govern "a D Board" or "a Military Estates Officer". It was necessary to make this provision because certain duties are imposed and powers conferred on the Board and certain other duties imposed and powers conferred upon the Military Estates Officer and the section makes it clear that the power to recover money is exerc;.sable by such of these two authozities as performs the duty or exercises the power E by reason of which the liability of another to pay the tax, rent or any other money arises.

In support ofthe view which I have expressed I may refer to a decision of the Court of Appeal in Tideway Investment and Property Hddings Ld. v. Wel/wood ('). There one of the questions which had to be considered related to award; ng costs to the successful plaintiffs who were the landlords of the defendants. The suit was brought in the High Court and the plaintiffs contended that since the <lefendants have committed a breach of the provisions of the lease they had forfeited it and, therefore, were entitled to possession on forfeiture as also to damages for breach of the contract contained in the lease. The defendants cla; med protection of the Rent Acts and Harman J., who heard the case held that the lease having already expired there could be no forfeiture and the tenant who was holding over became a statutory tenant entitled to ihe protection of the Rent Acts. Evershed M. R., however, said that the tenant became a trespasser or a statutory tenant and that the breach of the convenant was a continuing one .. Therefore, he said, it was plain that all claims arising out of the breach of the convenant and consisting primar'ly of a claim for possession must be regarded as arising out of or under the Rent Restriction Act,

1920. Harman J., also held that the claim must be regarded as

(') [l 952] l Ch. 971.

CANTO~MEl' BOARD AMDALA v. PYARE'-AL (Mudhelkar, .!.) 351

claims under the Rent Act and s. 17(2) precluded him from awarding costs to the successful plaintiffs. Section 17 (2) reads th us:

"A county court shall have jurisdiction to deal with any claim or other proceedings ar'sing out of this Act or any of the provisions thereof, notwithstanding that by reason of the amount of claim or otherwise the case would not but for this provision be within the jurisdiction of a county court, and, if a person takes• proceedings under this Act in the H; gh Court which he could have taken in the county court, he shall not be entitled to recover any costs." The Master of the Rolls, with whom the other Lords Justices agreed, took the same view as Harman J. It may be mentioned that the suit was not instituted under any specific provision of the Rent Acts

and the claim for possession was based on the breach of a covenant in the lease which the Court of Appeal treated as a ontinuing one and yet was treated as one under the Rent Restr'ction Act, 1922 because of the defence raised. This case thus illustrates that an expression such as the one found in s. 259 of the Act must be construed liberally and not narrowly. In Stroud's Judicial Dictionary, Vol. I, an Australian case, Winstone v. Wurlitz.er Automatic Phonograph Co. of Australia Pty Ltd. (') on which could not lay my hands is cited. There it was held that 'authorise' should be read in its ordinary sense of sanction, approve or countenance. I do not think that there is any substantial difference between

"Authorised by the Act" and "under the Act".

It would, therefore, be not right to construe the section in the way it was construed by the court below. On the other hand it must be held that where the liability to pay money arises against a person by reason of something done by the Board or the Military Estates Officer in exercise of a power or the performance of a duty under the Act that !'ability can be enforced by the authority concerned either by instituting the suit or by making an application to a Mag:strate.

Further, if the word 'rent' ins. 259 of the Act were to be given a restricted meaning that word itself would be rendered otiose because there is no provision whatsoever in the Act wh'ch expressly makes rent claimable or recoverable by either of the two authorities specified therein. Our attention was drawn to s. 257(1) which with out its proviso reads thus:

"If any such notice as is referred to in section 256 has been given to any person 'n respect of property of which he is the owner, the Board may require any occupier of such property or of any part thereof to pay to it, instead of to the owner, any rent payable by him in respect of

(') [1946] A.LR. 422.

352 SUl'REME COURT REPORTS (1965] 3 s.c.R.

such property, as it falls due, up to the amount recover- A able from the owner under section 256."

It cannot, however, be said that what the .Legislature had in contemplation when it amended s. 259 by adding the word "rent" therein was "rent" to which reference is made in s. 257(1). Sect'on 257 is complementary to s. 256. What s. 256 provides is as follows: B

"In the event of non-compliance with the terms of any notice; order or requisition issued to any person under this Act, or any rule or bye-law made thereunder, requiring such person to execute any work or to do any act, it shall be lawful for the Board, whether or not the person C in default is !'able to punishment for such default or has been prosecuted or sentenced to any punishment therefor, after giving notice in writing to such person, to take such action or such steps as may be necessary for the completion of the ; ict or work required to be done or executed by him, and all the expenses incurred on such account shall D be recoverable by the Board."

Therefore, what the Board has the power to recover from the person is the expenses which it has incurred. One of the modes is to proceed against the occupier of any property belonging to the owner thereof and require that occupier to pay E to the Board instead of to the owner the rent payable by-him to the owner. What the Board thus recovers from the person cannot obviously be regarded as rent in so far as the Board is concerned.

For, the Board is not the landlord of the occupier and what it recovers from his is not something which was due to the Board as rent from him. 'Rent' as commonly understood and as defined in F Jowitt's 'Dict'onary of English Law' is a sum of money payable periodically by a tenant to a landlord as compensation for occupa- tion of a building or land belonging to the landlord. It cannot thus include money payable by one person to another when they do not stand in the relationship of tenant and landlord. It is the Dict'onary meaning which has to be given to the word 'rent' in s. 259. G'ving G it this meaning it would be clear that what is referred to in s. 257(!) as rent was not intended to be included in that expression in s. 259.

Apart from s. 257 no other provision has come to our notice which can support the view of the H'gh Court as to the interpreta tion of s. 259. It may be mentioned that before the year 1940 there H was r. 42 in the Cantonment Land Administration Rules, 1937 which expressly auihorised the Board to recover all arre 0 rs of rent and "other payments" under the Rules by resorting to s. 259 of the Act. But that rule was repealed in 1940. It was represented to us by Mr. Gopal Singh that this was repealed because in view ot the wide language of s. 259 there was no need felt for the retention of the rnle. Whatever that may be. the position 's. if I may repeat,

CANTONMllNTBOARDAMBALA v. PYARELAL(Wanchoo, J.) 353

that if the word rent is given a restricted meaning as has been done by the High Court, that word would become purposeless. On the other hand if the expression is interpreted in the way suggested here it will serve a purpose for which it was intended.

For these reasons I am of the view that the appeal should be allowed.

ORDER BY COURT

In accordance with op'nion of the majority the appeal is. dis missed.

THE CANTONMENT BOARD, AMBALA

PYARELAL

March 12, 1965

K. N. WANCHOO, J.

R. MUDHOLKAR

ANDS. M. SIKRI, JJ.

Cantonments Act

ss. 256, 257 and 259

s. 250

Cantonments Act, 1924

Supreme Ccurt

s. 259(1)

Property Rules, 1925

s. 259

Section 257

s. 256

Per Mudholkar

s. 259

ss. 256 and 257

Gopal Singh

and Sikri

Wanchoo J. Mudholkar

s. 259

Cantonments Act

Ambala

s. 259

June 13, 1961

Ambala

s. 259

Lahore High Court

s. 259

s. 439

s. 259

ss. 435

ss. 435

Code of Criminal Procedure

s. 259

s. 259

ss. 435

Code of Criminal Procedure

ss. 435

Code of Criminal Procedure

Art. 227

Art. 227

s. 259

s. 259

Estate Officer under this Act

s. 259

s. 259

s. 259

s. 259

s. 259

s. 116

Central Government

Government of India

section 259

s. 259

s. 259

s. 256

Section 257

s. 256

s. 256

s. 257

s. 256

s. 259

AMBALAV. PYARELAL

s. 259

Mudholkar

s. 259

s. 435

Code of Criminal Procedure

Ambala Cantonment

s. 438

Code of Criminal Procedure

s. 438

s. 439

s. 259

Gopal S

SI of the Punjab Municipal Act

Banarsi Das

s. 259

s. 259

Section 259

ss. 116

Section 116

section 280

s. 259

Harman

Evershed M. R.

Rent Restriction Act

s. 17(2)

Section 17

s. 259

Stroud

s. 257(1)

section 256

section 256

s. 259

s. 257(1)

s. 256

s. 256

F Jowitt

s. 259

s. 257(!)

s. 259

s. 257

s. 259

s. 259

s. 259


KALURAM ONKARMAL AND ANOTHER v.

BAIDYANAIB GORAIN February I I. 1965 IP. B. 0AJENDRA.G; JJK:AR, C.J., M. HIDAYATULLAH, J. C. SHm AND

. S. M. SIKIU, JJ.J West Be,, gal Premises Tenancv Act. (12 of 1956), ss. 17, 21 and 22-Suit for eviction-Deposit of rent by tenant with Rent Controller and not im Court during pendencv of imit-If defence could be stn.1ck off under s. l"/ (3). The appellant and respondent were the tenant and owner respectively of premises to which the West Bengal Premises Tenancy Act, 1956, applied. The respondent filed a suit, under s. 13 of the Act, for the eviction of the appellant on various grounds. The appellant

deni•'d the allegations and contested the suit. Before the suit was filed, the appeilant was depositing the rent for the premises with the Rent Controller under s. 21 of the Act, becouse, the respondent was not prepared to accept the rent. The appellant continued to deposit the rent with !ht Rent Controller even after the suit wa• filed and the summons was served. Alleging that as soon as the suit was filed and a period of one month from the date of service. of the summons <>n the appellant had expired, it was obligatory on the appellant under s. 17(1), to pay the amount in court and not with tl\e Hent Controller, the respondent filed an application for striking out the defenre of the .appellant in the suit. The application was allowed by the trial court. The appellant's revision petition to the 'High Court was dismissed, following the decision of a Special Bnrh

of the High Court in Siddheswar Paul v. Prakash Chandra Dutta, A.LR 1964, Cal. 105.

In the appeal to this Court it was contended that the majority view in Siddheswar Paul's case that s. 22(3) does not apply to cases falling under s. 17(1) was wrong, because, the deposit made by the appellant under s. 21 with the Rent Controller constituted payment of rent by him to the landlord, under s. 22(3); and therefore, there was no scope for invoking s. 17(3) against the appellant inasmuch as the basis of s. 17(3) was that the tenant whose defence was sought to be' strurk out had committed a default in the poyment of rent.

HELD: Section 17(1) is a complete scheme by itself and the legislature1has intended that in suits or proceedings to which the section applies the payment of rent by the tenant to the landlord must l; e made in the manner prescribed by the section. The legislature wanted the section to control the relationsh'p between the landlord and the tenant as prescribed by it, once a suit or proceeding for ejectment was instituted and a period of one month from the date of service of the writ or summons on the defendant had expired.

E\'en in cases where the tenant might have been depositing the rent with the Controller tinders. 21, he has to comply with s. 17(1) before the period prescribed by the section had elapsed, because, as coon us a suit is filed against the tenant by the landlord for eviction. s. 17 \Vhich i_s a specal provision, comes into operation, and it is the provisions of that special section that must prevail in cases governed

by it. The object is, when a su;; or proceeding has commenced l'etween the landlord and the tenant for ejectment and the tenant had received notice of it, the payment of rent should be made in court to avoid any disputes in that behalf. The majority view in Siddheswar Paul's case correctly represents the true scope and effect of s. 17 as distinguished from ss. 21 and 22. f42E: 431-F; 45G-Hl

XALU!Wd v. BAIDYAN.A'IH (Gajendragadkar, 0. J .) 36

A Therefore, even the valid deposit made under s. 21 could not be permitted to oe pleaded by the tenant when the application waii made against him under s. 17(3). r43Cl

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 875 of 1964.

Appeal by special leave from the judgment and order dated B April 10, 1964, of the Calcutta High Co111; t in Civil Rule No. 4439 of 1962.

N. C. Chatterjee and D. Goburdhan, for the appellants.

P. K. Chatterjee and D. N. Mukherjee, for the respondent.

0 The Judgment of the Court was delivered by Gajendragadkar, C.J. Appellant No .. 1, Kaluram Onkarmal, was let into possession of the premises described as holding No. 182H, G.T. Road, Asansol as a monthly tenant under Harbhajan Singh Wasal who was the owner 't>f the said premises. The rent agreed to be paid was Rs. 35 per month payable according to the D English Calendar. It appears that in 1953, the Calcutta Nationat

Bank Ltd. (now in liquidation) sued the owner Wasal on the original side of the Calcutta High Court on a mortgage. In the said suit, a preliminary decree was passed and in due course, it was followed by a final decree. During the proceedings of the said suit, Mr. K. K. lihose was appointed Receiver of the mortgaged pro-

J!I perties, including the premises in the present suit. 0n February 18, 1960, the Receiver put the mortgaged properties to sale and the respondent, Baidyanath Gorain, purchased them. The said sale was confirmed by the Calcutta High Court on March 1, 1960. That is how the respondent became the owner of the suit premises amng with other properties under mortgage. After P he acquired title to the suit premises in this manner, the respondent intormed appellant No. 1 about the same by his letter dated the '2nd April, 1960.

On December 11, 1961, the respondent sued appellant No. l, and appellant No. 2, Kaluram Bajranglal in the First Court of the G .Munsif at Asansol for ejectment. He claimed vacant possession of the premises let out to appellant No. 1 on several grounds. He urged tbat he reasonably required the premises for rebuilding them after demolishing the existing structure. According to him, the existing structure had become very old and was in a dilapidated condit'on. He also a!Jeged that appellant No. 1 had unlawfully H sublet the suit premises to appellant No. 2, and that he had failed to pay or deposit the rents for the last three years in accordance with law.

The claim for ejectment thus made by the respondent was disputed by appellant No. I on several grounds. Appellant No. l denied that the respondent required the suit premises for rebuilding, and also disputed his allegation that he had sublet the said

premises unlawfully. In regard to the averment made by the res A pondent that appellant No 1 had failed to pay or deposit the rents Gue for the last three years, appellant No. 1 made a detailed denial. He urged that the rents had been regularly paid to the owner in ftme before August, 1960, and he pleaded that since the month of August, 1960 when he found that the owner was not prepared to accept the rents from him, he deposited them with the B House Rent Controller, Asansol, from month to month. It was his case that notice had been served on the owner in respect of these deposits from month to month as provided by section 21(3) of the West Bengal Premises Tenancy Act, 1956, (Act XII of 1956) (heremafter called 'the Act'). The written statement further averred that a the deposit of the monthly rent continued to be made regularly under s. :ll and that the rent for March, 1962 had been duly deposited on April 10, 1962. This written statement was filed on AprH 11, 1962. .

During the pendency of this suit, the respondent made an application under s. 17(3) of the Act and claimed that the defence D ot appellant No. l against delivery of possession should be struck out, because he bad failed to deposit or pay the amount in Court as required by s. 17(1) of the Act. This application was strenuously opposed by appellant No l on the ground that s. 17(3) could not be invoked against him in view of the fact that he bad been deposit- B ing the rent from month to month under s. 21. and he urged that the deposit of rent thus made by him amounted to payment of rent by him to the respondent under s. 22(3) and, therefore. no default had been committed by him at all. This dispute raised the question about the true scope and effect of the provisions of s. 17(3) nnd s. 22(3) of the Act. The learned trial Judge held that notwithp

tanding the fact that appellant No. I had been depositing the rent from month to month under s. 22 with tlie Rent Controller, having regard to the provisions contained in s. 17(1) his failure to deposit the relevant amount in Court incurred the liability to have hi~ defence struck out under s. 17(3). In coming to this conclusion, the learned Judge followed a decision of the Division Bench of the G Calcutta High Court in Abdul Majid v. Dr. Samiruddin('). Having held thats. 17(3) applied, the learned Judge directed that the defence raised by appellant No. l against the claim of the respondent for delivery of possession of the suit premises must be struck out.

This order was challenged by both the appellants by preferring B a revision application before the Calcutta High Court. Before this revision application reached the stage of hearing, the question raised by it had already been concluded by a majonity decision. of the Special Bench of the Calcutta High Court in Siddherivar Paul v.

Prakash Chandra Dutta('). The learned single Judge who heard this

(11 62 C.W.N. 555. \') A.LR. 196-i Cal. 105.

KAlURAM v. B"'IDYANATH (Gajendr111Ja.ikar, c. J.) 37

A revision application w.as naturally bound by the said majority decision, and applying the sa'd decisicm, he held that the order passed by the learned trial Judge striking out the defence of appellant No. 1 under s. 17(3) of the Act was justified. It is this order which is challenged by Mr. N. C. Chatterjee on behalf of the appellants in tlie present appeal which has been brought to this Court by B special leave. Mr. Chatterjee contends that the majority decision of the Special Bench in Siddheswar Paul's case(') is erroneous and has proceeded on a misconstruction of the tone, scope and effect of the two relevant section of the Act-ss. 17 & 22. That is how the short question which falls for our decision in the present appeal is: what C is the true scope and effect of the prov'sions prescribed by sections

17 and 22 of the Act? It appears that the Special Bench in Si4dheswm: Paul's case was divide:! on this issue; the three learned Judges "have taken the view that s. 22(3) does not apply to cases tailing under s. 17(1), whereas two other learned Judges have co.me to the conclusion that if a tenant had made a deposit with the D Rent Controller to which s: 22(3) applies, section 17(3) cannot be invoked against him. The separate judgments delivered by all the learned Judges who constituted the Special Bench have dealt with the point at great length and each one has subjected the said two provisions to a close analysis and examination.

In the present appeal, we propose to consider the matter in a broad way and will E confine ourselves to some general considerations which flow from the construction of the two relevant prC'Visions and which. in our opinion, support the view taken by the majority of the Judges in the- Special Bench.

Before addressing ourselves to the main point in dispute betr ween the parties, it is necessary to refer broadly to the scheme of the Act and its main provisions. The Act was passed in 1956 and' it superseded the earlier Act XVII of 1950. The Act consists of seven Chapters. Ch. I deals with definitions; Ch. II contains provisio.1s regarding rent; Ch. III cove.rs suits and proceedings for

ev1cllon; Ch. IV has reference ta deposit of rent; Ch. V consideu G the question of appointment of the Controller and other Officers, their powers and functions; Ch. VI provides for appeals, revision and review; and Ch. VII deals with penalties and miscellaneous provisions. Section 2(b) defines a "Controller"; s. 2(c) defines "fair , rent"; s. 2(d) defines a "landlord"; and s. 2(h) define~ a "tenant".

A tenant, according to s. 2(h), includes any person by whom <Yr II on whose account or behalf, the rent of any premises is. or but for a special contract would be payable and also any person contlnumg in possession after the termination of hi~ tenancy, but shall not include any person against whom any decree or order for eviction has been made by a Court of competent jurisdiction. Section

(') A.LR. [106'] C•l. 105.

HD provides that a tenant shall, subject. to the provisions of the A Act, pay to the landlcrd: (a) in cases where fair rent has been fixed for any premises, such rent; (b) in other cases, the rent agreed upon until fair rent is fixed. Section 4(2) lays down tha~ rent shall be paid within the time fixed by contract or in the

absence of such contract, by the 15th day of the month next fol< Jcwmg the month for which it is payable; and undev s. 4(3), any B sum in excess of the rent referred to in sub-s. (I) shall not be recoverable by the landlord. These provisions. are in cohformity with the pattern which is usually adopted by Rent Restriction Acts.

The rest of the provisicns of Chapter II deal with the fixation of standard rent; with the said provisions, we are not concerned in ihe C! present appeal.

Chapter III which deals with suits and proceedings for eviction contains s. 17 which falls to be considered in the present appeal. Section 13 which affords protection to tenants against eviction, lays down that notwithstanding anything to the contrary in any other law, no order or decree for the recovery of possession of I> any premises shall be made by any Court in favour of the landlord against a tenant except on one or more of the grounds specified by clauses (a) to (k). Amongst these clauses, it is clause (i) which deals with a case where the 'tenant has made default in the payment of rent for two months within a period of twelve months or for two successi'le periods in cases where rent is not pa¥<1ble E monthly. Section 14 imposes a restriction on subletting. Secti6n 15 prohibits a tenant from receiving any sum or consideration foi:

relmquishment of tenancy; and s. 16 provides that the creation and termination of sub-tenancies shall be notified in the manner prescribed by it. That takes us to s. 17. Section 17(1) reads thus:-- p "On a suit or proceeding being instituted by the landlord on any of the grounds referred to in s. 13, the tenant shall, subject to the provisions of sub-s (2), within one month ot me service of the writ of summons on him deposit in Court er pay to the landlord an amount calculated at the rate of rent at which it wa.s last paid, for the period for which the tenant may have made default inciuding the period subsequent thereto up to the end of the month previous to that in which the deposit or paynient is made together with interest on such amount calculated at the rate of eight and one-third per cent, per annum from the date when any such amount was payable up to the date of deposit. and shall thereafter continue to depqsit or p1y, month by month, by the 15th of each succeeding mcnth

a sum equivalentto the rent at that rate."

ection 17(2) deals with cases where there is a dispute as to the amount of rent payable by the tenant. This provision is not relevant tor our purpose. Section 17(3) provides that if a tenant fails to-

ULURAM 'V, BAlDYANATH (Gajendragadkar, c. J.) 39

A deposit or pay any amount Teferred to in sub-s. (]) or sub-section (2), the Court shall order the defence against delivery of possesion to be struck out and shall proceed with the hearing of the suit. It

is under this sub-section that the impugned order has been pased_ Section 17(4) lays down: -

" lf a tenant makes deposit or payment as required by sub-s. (1) or sub-s. (2), no decree or order for delivery of possession of the premises to the landlord on the ground of default in payment of rent by the tenant shall be made by the Court but the Court may allow such costs as it may deem fit to the landlord :

Provided that a teriant shall not be entitled to anv relief under this sub-section if he has made default in payment of rent for four months within a period of twelve months." Reading s. 17(') by itself, it is clear that when a landlord .D tnstitutes a suit to recover possession of the premises let to his tenant on any of the grounds referred to in s. 13, the tenant is required to deposit the amount in Court as provided by it. It wculd be noticed that the first part of s. 17(1) enables the tenant who has committed a default in the payment of rent prior to the institution ot the suit to make up for that ct:efault and pay the defaulted B amount as specified by this sub-section. This can be done subject to the condition that the tenant pays interest on the defaulted amount calculated in the manner prescribed by it. In regard to the amount payable in future pending the suit or proceeding, s. 17(1) provides that the tenant shall thereafter continue to deposit or pay, p month by month, by the 15th of each succeeding month a sum eq1.1ivalent to the rent at that rate. In the Calcutta High Court there appears to be a difference of opinion as to whether the amount which is required to be deposited by the tenant is rent or not. We are proceeding to deal with the present appeal on the footing that the said amount in law is rent, though it is not described as G such by s. 17(1).

It is thus clear that whatever may be the cause on which the landlord's claim for eviction is based, s. 17(1) provides that subject to the provisicns of sub-s. (2), within one month of the service of the writ of summons on him, the tenant is required to deposit R in Court the amount in the manner prescribed by it. If he fails to comply with the requirements of s. 17(1), s. 17(3) steps in and enables the landlord to claim that the defence of the tenant against dehvery of possession should be struck out. If section 17(1) and (3) are read by themselves, there is no doubt that appellant No. 1 has failed to comply with 's. 17(1), and so, s. 17(3l can be legitimately invoked against him. He, however, contends that in applying s. 17(3), the Court must take into account net only

s. 17(1) but also s. 22(3), and his argument is that if he has A deoosited the amount of rent under s. 21 and the deposit is other• wise valid. then the deposit itself amounts W payment of rent by him to the landlord and as such, no order can be passed agairust him under s. 17(3), because, in law, he has not committed a default in the payment of rent at all; and it is this contention which makes it necessary ta consider the impact of the provisions of s. 22 on B the application of s. 17(3) against appellant No. I.

Let us. therefore. read s. 22 and attempt to decide what is the etfect of .s. 22(3) on cases falling under s. 17(1). As we have already pointed out, s. 22 occurs in Chapter IV w.hich deal.> with deposit cf. rent. This Chapter begins with s. 21. Section 21(]) proc v10es that where the landlord does not accept any rent tendered by the tenant within the time referred to in s. 4, or where there 1sa bona fide doubt as to the person or persons to whom the rent is payable. the tenant may depqsit such rent with the Controller in the prescribed mrrnner. Secti.on 21(2) lays down that the deposit snail be acccmpanied by an application which should set forth D the particulars prescribed by clauses (a) to \d). Section 21 (3) requires that the said application shall be accompanied by the prescribed number of copies thereof. Section 21(4) requires the Controller to send a copy of the application received by him from the tenant to the landlord. Under s.-21(5), the Controller is authorised to allow the lafldlord to withdraw the rent deposited with B him. Section 21(6) empowers the forfeiture of the deposit to Government, subject to the conditions orescribed by clauses (a) & (b) ot the said sub-section. There are three other sub-sections to s. 2 ! . which are not relevant for our purpose.

That takes us to s. 22 it reads thus: - i' "(!) No rent deposited _under s. 21 shall be considered to have been valijl y deposited under th1t section for purposes of clause (i) of sub-section (!) of s. 13, unless deposited within fifteen days of the time fixed by the contract in writing for payment of the. rent or, in the absence of such contract in writing, unless deposited G within the last day of the month following that for which the rent was payable.

(2) No such deposit shall be considered to have been validly made for the purpose. of the said clause if the tenaRt wilfully or negligently makes any false statement B to his application for depositing 'the rent, unless the landlord has withdrawn the amount deposited before the date of institution of a suit t>r proceeding for recovery, or possession of the premises from the tenant.

13> If the rent is deposited within the time mentioned in sub-section Ul. and does not cease to be a valid depcsit for the reason mentioned in sub, section (2), the deposit

KALURAM v. BAIDYANATH (Gajemlragadkar, c. J.)

A 1hall constitute payment of rent to the landlord as if the amcunt deposited has been valid legal tender of rent if tendered to the landlord on the date fixed by the contract for payment or rent when there is such a contract, Gr, in the absence of any contract, on the fifteenth day of the month next fellowing that for which rent is payable." B Mr. N. C. Chatterjee for the appellants contends that the etfect of s. 220) ls that the deposit made by appellant No. 1 shall be held to constitute payment by him to the landlord, and so, there can be no scope for invoking s. 17(3) against him inasmuch/the bas1& of s. 17(3), in substance, is that the tenant whose defence is c sought to be struck out has committed a default in the payment of rent. The object of s. 17(}) is to secure the payment of rent by the tenant to the landlord and since that object has been satisfied by the deposit duly made by appellant No. I under s. 21 (I), it would be unreasonable to allows. 17(3) to be invoked against hii.

It is common ground that the deposit cf rent has been made by appellant No. I in compliance with the provisions of s. 2 l &nd that it is not rendered invalid under s. 22(2). In other words, Mr. N. C. Chatterjee is entitled to urge his point on the assumption that appellant No. 1 has made a valid deposit under s. 21 and is entitled to the benefit of s. 22(3). Can a valid deposit made under s. 21 be permitted to be pleaded by a tenant when an application is made against him under s. 17(3)?;. that is the question which arises for our decision in the present appeal. The answer to this question necessarily depends upon the determination of the true scope and effect of the provisions contained respectively in s. 17 ands. 22.

As a matter of common-sense, Mr. N. C. Chatterjee's argument does sound to be prima facie attractive. If, in fact, appellant No. I has deposited the rent from month to month, it does appear harsh and unreasonable that his defence should be struck out on the ground that he has .deposited the rent not in the Court where the suit is pending, but with the Controller. When appellant No. I began to deposit the rent with the Controller, he was justified in doing so; but on the other hand. it is urged against him by Mr. P K. Chatterjee that as soon as the suit is filed under s. 17 and the period prescribed by it has expired, it was obligatory on appellant No.

I to pay the amount in Court and stop depositing it with the Rent Controller; in other words, his failure to pay the amount in Court incurs the penalty prescribed bys. 17(3) notwithstanding the fact that he may have deposited the same amount with the Controller. The requirements of s. 17(1) cannot be said to be satisfied by taking recourse to the provisions of s. 22(3\; that in substance is the argument for the respondent. The question thus raised for our decision no doubt lies within a very narrow COffiJYdSS and its answer depends upon a proper construction of sections I 7 and 22; but, as we have already indicated, this narrow

question has given rise to a sharp conflict cf opinion in the Calcutta A High Court. It appears plain that appellant No. I finds himself in the present difficult position presumably because, acting upo!l the view expressed in some of the judgments of the Calcutta High Court, he was advised to deposit the rent with the Controller even after he was sued. by the respondent and s. 17(1) began to operate against him.

In dealing with this vexed problem, it is relevant to remember that the two competing provisions occur in two different Chapters and apparently cover different fields. Chapter IV deals with the question of deposit of rent in general, whereas s. 17 in Ch J! 1 makes a provision for the payment of the amount mentioned bv it c in .court after a subt or proceeding has been !intituted1 by the landlord against the tenant. It is common ground that the !< ent Controller is not Court within the meaning of s. 17(1). Prima fade. a eneral provision for the deposit of rent prescribed by s. 21 would not apply to special cases dealt with by s. 17. The provisions of s. 21 and 22 which are genera] in character, would cover cases D which are not expressly dealt with by the special provision prescribed by s. 17 .. In other words, though a tenant may deposit rent with the Controller under the provisions of ss. 21 and 22, as soon as a suit is brought against him by the landlord, s. 17 which is a special provision, comes into operation and it is the. provision of this special section that must prevail in cases covered by it: that E is the first general consideration which cannot be ignored.

Section 17 deals with suits or proceedings in which the landlord claims eviction on any of the grounds referred to in s. 13; and as we have already noticed, s. l3 which affords protection to the tenant's eviction, permits the landlord to claim eviction only if he F can place his claim on one or the other of the clauses (a) to lk); that is to say, it is only if one or other of the conditions prescribed by the said clauses is proved that the landlord can claim to evict his tenant. Default in the payment of rent is one of these clauses, but there are several other clauses referring to different causes of action on which eviction can be claimed by the land G lord, and it is to all these cases that s. 17(1) applies. It is thus clear ihat normally, when a suit is brought for eviction, the tenant would have to comply with the requirements of s. 170). It is only where owing to the refusal of the landlord to accept the rent tendered by the 'tenant, or where there is a bona fide doubt as to who is entitled to receive the rent, that the provisions of s. 21 empower the tenant H to deposit the rent with the Controlle~. In all other cases, if the tenant was paying rent to the landlord and is faced with a suit for eviction, s. 17(1) will unambiguously apply and the amount of

rent will have to be paid in Court as required by it. It is also clear that if a tenant has been depositing the rent validly and properly under s. 21 .. a suit against him under s. 13(1)(i) cannot be filed.

Section !l(l)(i) authorises the lanord to claim eviction of his

KALURAlll 9. BAIDYANATH (Gajendragadkar, c. J.) 43

A tenant on the ground that he has made a default in the pament

of rent as described by it. But such a default cannot be attribu.ted to a tenant who has been depositing the rent with the Controller properly and validly under s. 21. Such a valid payment amounts to payment of rent by the tenant to the landlord under s. 22(3), and so. a tenant who has been making these deposits cannot be sued B under s. 13(1)(i).

It is true that the complication of the present kind arises where a tenant who has been making a valid deposit under s. 21 is sued for ejectment on grounds other than s. J3(l)(i), and s. 17(1) comes into operation against him. In such a case, if the special provisions c prescribed by s. 17(1) apply to the exclusion of sections 21 & 22, the fact that a deposit has been made by the tenant can be no answer to the application made by the landlord under s. 17 (3)

In this connection, it is necessary to bear in mind the fact that s. 17(1) is really intended to give a benefit to the tenant who D has committed a default in the payment of rent. The first part of s. 17(1) allows such a tenant to pay the defaulted amount of rent together with the prescribed interest in Court within the time prescribed, and such a tenant would not be evicted if he continues to deposit the amount in Court, during the pendency of the suit

as required by the latter part of~. 17(1). In our opinion, the scheme E of s. 17(1) is a complete scheme by itself and the Legislature has intended that in suits or proceedings to .which s. 17(1) applies, the payment of rent by the tenant to landlord must be made in !he manner prescribed by s. 17(1). Even n cases where the tenant might have been depositing the rent with the Controller under s. 21, he has to comply with s. 17(1) before the period prescribed I' by s. 17 (1) has elapsed. It is significant that the requirement to deposit the amount in Court comes into force within one month of the service of the writ of summons on the tenant. In other words, appellant No. 1 was justified in depositing the rent even after the present suit was filed until one month from the service of the writ of summons of the suit had elapsed. The Legislature has taken the 6 precaution of giving the tenant one month's period after the service of the writ of summons on him before requiring him to deposit the amount in Court. The object obviously appears to be that when a suit or proceeding has commenced between the landlord and the tenant for ejectment, and the tenant has received notice of it, the payment of rent should be made in Court to avoid any dispute l'I in that behalf.

It is also relevant to remember that in the matter of payment of rent in Court, s. 17(1) has provided that the amount to be paid in future shall be paid by the 15th of each succeeding month, and that means that the date for the payment of the amount has been tatutorily fixed which is distinct f,.om the rqiremen~ of s. 4.

Section 4(2) provides for the p2 >meLt d rent withm the time fixed

44 SUl'REKE

COURT

REPORTS

(1965) 3 8.C.R.

by contract, but s. 170) requires the pa}!llleitt to be made by the A. 15th of each succeeding month whatever may be the contract. If, according to the contract, rent was payable quarterly, or sixmonthly, or even annually, s. 17(1) supersedes that part of the contract .2nj requires the rent to be paid, month by month, by the 15th of each succeeding month.

The position under sections 21 & 22 is, however, substantially different on this point. Section 210) in terms requires the deposit to be maae within the time referred to in s. 4, and that means where there is a contract made by the parties in relation to the time for the payment of rent, it is on the contracted date that the rent has

; o be deposited under s. 21. The scheme of the three clauses of C s. 22 clearly is integrally connected with s. 21. These clauses deal with deposits made under s. 21. In fact it would be difficult to read s. 22(3) independently of s. 22(1) and (2); all the three clauses of s. 22 must be read together, and so, the time for making the deposit for the purpose of s. 22(3) would be the time prescribed by contract and not the statutory time provided by s. 17(1). It is clear D that the deposit of rent made before the Controller under section 21 is based on the contractual obligation of the tenant to pay the rent, and he makes the deposit because the landlord is not receiving the rent or there is a dispute as to who the real landlord is. On the other hand, the deposit of rent made in Court under s. 17(1) is the result of a statutory obligation imposed by the said sub-section; 111 no doubt, the amount required to be deposited may .be the amount for which the parties may have entered into a contract, but the manner and the mode in which the deposit is required to be made in Court are the result of the statutory provision, and in that sense they constitute a statutory obligation. That is another feature which p distinguishes the deposits covered by sections 21 and 22 from the deposits prescribeil by s. 17(1).

Mr. N. C. Chatterjee argued that if the majority view of the Calcutta High Court is upheld, it may lead to some anomalies. As an illustration, he asked us to consider the case of a suit falling G under s. 17(1) which ultimately fails and is dismissed. In such a suit, the rent would have to be deposited in Court by the tenant as required by s. 17(1); but if the suit fails, what happens to the rent? Would the tenant be treated as being a defaulter, or would the tenant who is required to 'make a deposit in Court as required by s. 17(1) be compelled as a precaution, to make another deposit H with the Controller in cases where the landlord had refused to accept rent before he filed the suit? We are not impressed by this argument. In our opinion, if the tenant had deposited the rent in Court as required bys. 17(1), he could not be treated as a defaulter under any provision of the Act. Payment in Court made by the tenant under the statutory obligation imposed on him would, m Jaw, be treated as payment of rent made by him to the landlord.

KALURAM v. llAIDYANATH (GaJendragidkar, 0. J.) 45

Mr. N. C. Chatterjee also relies on the fact that s. 24 in terms provides that the acceptance of rent in respect of the period of default in payment of rent by the landlord from the tenant hall operate as a waiver of such default, when there is no proceeding pending in Court for the recovery of possession of the premises.

The arguni.i:nt is that where the Legislature intended to confine the operation of a specified provision to cases where there is no proceeding pending in Court, it has expressly so stated. In our opinion. this argument is not well-founded. Section 24 merely indicates that the Legislature thought that it was necessary to make that provision in order to avoid any doubt as to whether acceptance of rent would amount to waiver or not in cases where no proceeding was pending in Court. On the other hand, from the wording of s. 24 it may be permissible to suggest that the Legislature did not think vf

providing for the consequence of acceptance of rent after the commencement of a proceeding for the recovery of possession. because it knew that the said matter would be covered by s. 17(1),

Besides, s. 22(2) gives some indication that the provisions cf s. 22 are not intended to be applied when suits or proceedings have commenced between the landlord and the tenant. It would be noticed that s. 22(2) says that no deposit shall be considered to have been validly made for the purposes of s. 22(1) if the tenant wilfully or negligently makes any false statement in his application E for depositing the amount unless the landlord has withdrawn the amount deposited before the date of institution of a suit or proceeding for recovery of possession of the premises from the tenant. This last clause may suggest that the provisions of all the clauses of s. 22 may not be applicable after the suit or proceeding has commenced.

F As we have already pointed out, the question raised for our decision in the present appeal really centres round the determination of the areas covered by s. 17 on the one; hand, and sections 21 and 22 on the other; and though it may be conceded that the words used in the respective sections are not quite clear, on the whole the scheme evidenced by them indicates that the Legisla- G ture wanted s. 17(1) to control the relationship between the landlord and the tenant as prescribed by it once a suit or proceeding for ejectment was instituted and a period of one month from the service of the writ of summons on the defendant had expired. We

have carefully considered the reasons given by the two learned H Judges who delivered the minority judgments in the Siddheswar Paul's(') case, but we have come to the conclusion that the majority view on the whole correctly represents the true scope and effect of s. 17, as distinguished from sections 21 and 22.

' ' In the result, the appeal fails and must be dismissed. There would be no order as to costs. ·

(')A.LR. [1965] Cal. 105.

LJB(D)2SCl-5

46 SUPBEllE

COURT

REPORTS

(1965] 3 8.C.R.

Before parting with this appeal, however, we would likt> to A • add that appellant No. I has to submit to the penalty prescribed by s. 17(3) apparently because. acting upon the opinion expressed by some of the learned Judges of the Calcutta High Court, he was advised to continue to deposit the rent with the Controller even after the present suit was filed against him. We do not know whether there are many other cases of the same type. In case tllere B are several other cases of this type, that would really mean unjust hardship against tenants who, in substance, have not committed default in the matt.er of payment of rent, and yet would be exposed to the risk of ejectment by virtue of the application of s. 1713). In our opinion, such tenants undoubtedly deserve to be protected against ejectment. We trust the Legislature will consider this matter f' and devise some means of giving appropriate relief to this class of ce.nants.

Appeal dis1nisseli.

KALURAM ONKARMAL AND ANOTHER

BAIDYANAIB GORAIN

M. HIDAYATULLAH, J.

Premises Tenancv Act

ss. 17, 21 and 22

s. 13

s. 21

s. 17(1)

Siddheswar Paul

s. 22(3)

s. 17(1)

s. 21

s. 22(3)

s. 17(3)

s. 17(3)

Section 17(1)

s. 17(1)

s. 17

s. 17

ss. 21 and 22

s. 21

s. 17(3)

N. C. Chatterjee

D. Goburdhan

P. K. Chatterjee

D. N. Mukherjee

Gajendragadkar

Kaluram Onkarmal

Harbhajan Singh Wasal

Calcutta Nationat

Bank Ltd.

Wasal

Calcutta High Court

K. K. lihose

February 18, 1960

Baidyanath Gorain

March 1, 1960

2nd April, 1960

December 11, 1961

Kaluram Bajranglal

First Court of the G .Munsif at Asansol

Asansol

section 21(3)

West Bengal Premises Tenancy Act, 1956

April 10, 1962

AprH 11, 1962

s. 17(3)

s. 17(1)

s. 17(3)

s. 21

s. 22(3)

s. 17(3)

s. 22(3)

s. 22

s. 17(1)

s. 17(3)

G Calcutta High Court

s. 17(3)

Chatterjee

ss. 17 & 22

sections

17 and 22

s. 22(3)

s. 17(1)

section 17(3)

Section 2(b)

s. 2(c)

s. 2(d)

s. 2(h)

s. 2(h)

Section 4(2)

s. 4(3)

Rent Restriction Act

s. 17

Section 13

Section 14

s. 16

s. 17

Section 17(1)

s. 13

Section 17(3)

ULURAM 'V

BAlDYANATH (Gajendragadkar

Section 17(4)

s. 17(')

s. 13

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(3)

section 17(1)

s. 17(1)

s. 17(1)

s. 22(3)

s. 21

s. 17(3)

s. 22

s. 17(3)

s. 22

s. 22(3)

s. 17(1)

s. 22

s. 21

Section 21(])

s. 4

Section 21

Section 21(4)

Section 21(6)

s. 2

s. 22

s. 21

s. 13

s. 220

s. 17(3)

s. 17(3)

s. 17(})

s. 21

s. 2

s. 22(2)

s. 21

s. 22(3)

s. 21

s. 17(3)

s. 17

P K. Chatterjee

s. 17

s. 17(1)

Calcutta A High Court

s. 17

s. 17(1)

s. 21

s. 17

s. 21 and 22

s. 17

ss. 21 and 22

s. 17

Section 17

s. 13

s. 17(1)

s. 170

s. 21

s. 17(1)

s. 21

s. 13(1)(i)

BAIDYANATH

s. 21

s. 22(3)

s. 13(1)(i)

s. 21

s. 17(1)

s. 17(1)

sections 21 & 22

s. 17

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(1)

s. 21

s. 17(1)

s. 17

s. 17(1)

s. 4

Section 4(2)

s. 170

s. 17(1)

sections 21 & 22

Section 210

s. 4

s. 21

s. 22

s. 21

s. 21

s. 22(3)

s. 22(1)

s. 22

s. 22(3)

s. 17(1)

section 21

s. 17(1)

sections 21 and 22

s. 17(1)

s. 17(1)

s. 17(1)

s. 17(1)

s. 24

Section 24

s. 24

s. 17(1)

s. 22(2)

s. 22

s. 22(2)

s. 22(1)

s. 22

s. 17

sections 21 and 22

s. 17(1)

s. 17

sections 21 and 22

s. 17(3)

s. 1713


THE CALCUTTA TRAMWAYS CO. LTD.

THE CORPORATION OF CALCUTTA

March 12, 1965

[K. SUBBA RAO, J.C. SHAH AND R. S. BACHAWAT, JJ.J B

Cakutta Tnnrvways Act (W.B. Act 25 of 1951), s. 5-·.4.greements with .4.rbitration clause-Whether saved.

By the enactment of Calcutta Tramways Act, 1951, the Government of west Bengal was substituted tor the Corporation of Calcutta

(HesponJent) ln ; arious agreements entered into between the predeccssors-m-interest of the appellant and the predecessors-in-interest of the rtopondcnt, subject to a reservation that any sum payable under the agreements shall be payable by the appellant to the respondent.

All the agreements contamed an arb.traLon ckuse which provided for refcr.1:1ng aHy u1sputes arising under the agreements to arbitration a1 the prescribed .manner. Disputes arose as regard the track rent. payable by the appeUant to the responuent and the dispute was referr.; d to arb.trat1on in accordance with the terms of the arbitration clause. 'lhe appellant nominated its arbitrator without pcejuciice to its right;, and tiled an application in the High Court, for the determinat.on oi lne que.stion whether there was a valid agreement netween the appellant and respondent. The High Court held that there was an agreement. In appeal by special leave:

HELD: Both the r'ght to the sums payable to the respondent and the proced'1re of arbitration were saved under the Act.

The proviso to s. 5 of the Act, in terms as well as hy necessary implication brings the subject-matter of the sums payable under the agreements both under the substantive and procedural aspects within the scope of the exception. The substantive right to the payment of rent and the procedural one to have any dispute arising in respect of that rigllt relerred to arb'tration embodied in the agreements are interconnected and are not severable. To preserve the substantive right and to withhold the procedural right to enforce it is to save the

right and deny the remedy, (357. C-D, F-G]

C1viL APPELLATE JurusmcnoN: Civil Appeal No. 245 of 1964. .

Appeal by special leave from the judgment and order dated February 13, 1963, of the Calcutta High Court in Award Case No. 8 of 1963.

A. V. Viswanatha Sastri and D. N. Gupta, for the appellant.

S. T. Desai and P. K. Mukherjee, for the respondent.

The Judgment of the Court was de!ivered by

Sobba Rao, J. On or about October 2, 1879, the Corporation of the town of Calcutta incorporated under Bengal Act IV of 1876

into an ag!eement in writing with Dillwyn Parrish, A!freoh Parrish and Robmson Souttar, hereinafter called the grantees.

CAL. TRAMWAYS v. CORPORATION OF CALCUTTA (8ubba Rao, J.) 355

whereunder the Corporation granted to the said grantees the right to construct, maintain and use certain tramways in Calcutta on payment of certain rents as provided in the said agreement. The aoreement contained an arbitration clause which provided for r; ferring any disputes arising under the said agreeme_nt to arbitration in the manner prescribed thereunder. The said agreement further provided in cl. 28 that the words "the said Corporation" would include the Corporation and its successors. Different agreements were entered into between the successors of the Corporation of Calcutta and the grantees from time to time, namely, on November 22, 1879, September 2, 1893 and December 9, 1899, and were confirmed by appropriate Acts. In all these agreements the appellant's predecessor-in-interest agreed to pay the rents to the respondent's predecessors-in-interest in respect of the tramways constructed, maintained and used by them. All the said agreements contained an arbitration clause similar to that contained in the first agreement. The Corporation. of Calcutta is now the successor of the properties of the Corporation of the town of Calcutta constituted under the Bengal Act IV of 1876. It was constituted by Bengal Act II of 1888. The appellant, i.e., the Calcutta Tramways Co. Ltd., is the successor or the assignee of the said grantees. On August 30,

1951, the State of West Bengal entered into an agreement with the appellant whereby the Government agreed to purchase the undertaking of the appellant as provided in the said agreement. The said agreement was subject to an Act being passed by the appropriate Legislature ratifying the agreement and giving effect to it. The Calcutta Tramways Act, 1951 (W.B. Act XXV of 1951) was passed and it came into effect on October 18, 1951. Under that Act the Government of ·, vest Bengal was practically substituted for the Corporation of Calcutta under the various agreements subject to a

reservation that any sums payable under the said agreements shall be payable by the appellant to the Corporation. Disputes arose as regards the track rent payabie by the appellant to the Corporation and the dispute was referred to arbitration in accordance with the terms of the" arbitration clause. Though the parties appointed arbitrators in terms of the arbitration clause of the agreements, the appellant nominated its arbitrator without prejudice to its rights and filed-oo 7, 196_3, an in the Original Side of the Calcutta High Court, mter a/ia, for the determination of the question whether there was a valid arbitration agreement between the appellant and the respondent and for other incidental reliefs

The application was heared by AN. Ray, J. who held that there an agreement between the appellant and the respondent and that the appellant was a party to the arbitration clauses contained in the relevant agreements, that the respondent could make a reference to arbitration in terms of the said agreements and that the reference to arbitrators was valid, legal and effective. The appellant, by special leave, has filed the present appeal against the said order of

the High Court.

L/Il(N)3SCI-IO

356 •

SUPREME COURT REPORTS [1965] 3 s.c.R,

Mr. A V. Viswanatha Shastri, learned counsel for the appellant, contended that all the rights of the Corporation of Calcutta under the various agreements stood transferred under the Tramways Act, 1951, and vested in the Government of West Bengal except only in regard to the sums payable to the Corporation and

that, therefore, the Corporation could not rely on the arbitration clauses of the agreements and refer the disputes arising in respect of the sums payable in terms of the said agreements to. arbitration.

The point raised is in a small compass and turns upon the relevant provisions of the West Bengal Act XXV of 1951, hereinafter called the Act. Under the Act the agreement entered into on August 30, 1951, between the Governor of West Bengal on the one part and the Calcutta Tn, mways Co. Ltd. on the other part was confirmed. Section 3 of the Act says, "The transfer agreement is hereby confirmed and made binding on the p1rties thereto and the several provisicns thereof shall have effect as if the same had been enacted in this Act." "Section 4 enacts that notwithstanding anything to the contrary in any other law, all the powers and.duties of the Corporation of Calcutta, the Commissioners of the Howrah Municipality, the Commissioners of the South Suburban Municipality and the Commissioners for the New Howrah Bridge with respect to the construction, maintenance, use:, leasing of or otherwise dealing with tramways are transferred to and vested in the Government". Section 5, which is the crucial section, reads:

(!) The several agreements particulars whereof are set out in the Second Schedule to this Act shall have effect as if the Government were parties thereto in lieu of the respective bodies and persons set out in column 2 of the said Schedule and any reference in any such agreement to any of such bodies or persons shall unless the subject-matter or the context otherwise requires be deemed to be a reference to the Government:

Provided that any sums payable under any such agreement to any of such bodies or persons shall ccntinue to. be payable as if this Act had not been passed.

The Second Schedule contains a list of the titles of the various agreements mentioned by us earlier. Under s. 5 of the Act the Government is statutorily substituted for the respondent or its predecessors-in-interest in the various agreements stated supra. The fiction is a well defined one. The Government replaces the Corporation and its predecessors-in-interest as a party to the agreements unless the subject-matter or the-context otherwise requires. The natural presumption is that but for the proviso the enacting part of

the section wonld have inducted the subject-matter of the proviso also. The proviso tc s. 5 saves from the operation of the substantive section the sums payable under any such agreements to any

such bodies mentioned therein: it excludes the operation of the

CAL. TRAMWAYS v. CORPORATION OF CALCUTTA (SubbaRao, J.) 357

fiction in respect of such sums payable. In respect of the said sums payable the agreements entered into with the said bodies will remain intact as if the Act had not been passed; that is to say, the respondent would still continue to be a party to the said agreements for the said purpose. The relevant agreements provided for the recovery of the rents and also for the procedure for the recovery of the sums so payable in accordance with the terms of the arbitration clauses of the agreements. Had not the Act been passed and had the Government nci been substituted in the place of the Corporation, it cannot be denied that the Corporation, if a dispute arose in regard to the rent, could have referred the dispute to arbitration.

The substantive right to the payment of rent and the procedural one

to have any dispute arising in respect of that right referred to arbitration embodied in the agreements are interconnected and are not severable. To preserve the substantive right and to withhold the procedural right to enforce it is to save the right and to deny the remedy. To accept the contention of the appellant is to make out a new agreement between the parties in respect of the sums payable.

The acceptance of this suggestion compels the Ccrporation to give

up its agreed remedy. The alternative suggestion, namely, that in respect of the amounts payable to the Corporation the arbitration clauses of the agreements could be enforced by the Government against the appellant introduces an incongruity. While the dispute would be between the appellant and the Corporation, the arbitration would be between the appellant and a third party. The argument that the Goveroment would ]Je acting as a trustee of the Corporation in respect of the sums payable to the Corporation is not supported by any of the provisions of the Act. A fair construction of the proviso to s. 5 of the Act removes all the anomalies.

Further, in the substantive part of s. 5 of the Act the fiction takes effect unless the subject-matter or the context otherwise requires.

The proviso in terms as well as by necessary implicatic-n brings the subject-matter of the sums payable under the agreements under. the and .Pro:edural aspects within the scope of the said exceptton. The fiction m s. 5 of the Act shall yield. to that extent, to the terms of the c_ontract. On such a construction we hold as we have indicated earlier, that both the right to the said payable and the procedure of arbitration are saved thereunder.

In the result, we agree with the view expressed by the High Court and dismiss the appeal with costs.

Appeal dismist1ed.

THE CALCUTTA TRAMWAYS CO. LTD

CORPORATION OF CALCUTTA

March 12, 1965

K. SUBBA RAO, J

C. SHAH

R. S. BACHAWAT, JJ

Cakutta Tnnrvways Act

s. 5

Government of west Bengal

tor the Corporation of Calcutta

s. 5

Calcutta High Court

A. V. Viswanatha Sastri

D. N. Gupta

S. T. Desai

P. K. Mukherjee

Sobba Rao

Calcutta

Bengal Act IV of 1876

Dillwyn Parrish

A!freoh Parrish

Robmson Souttar

cl. 28

November 22, 1879

September 2, 1893

December 9, 1899

Bengal Act II of 1888

Calcutta Tramways Co. Ltd.

August 30,

1951

State of West Bengal

Calcutta Tramways Act, 1951

October 18, 1951

Government of ·, vest Bengal

Corporation of Calcutta

AN. Ray

A V. Viswanatha Shastri

Government of West Bengal

Bengal Act XXV of 1951

August 30, 1951

West Bengal

Calcutta Tn, mways Co. Ltd.

Section 3

Section 4

Howrah Municipality

South Suburban Municipality

Section 5

Second Schedule

Second Schedule

s. 5

s. 5

s. 5

s. 5

s. 5