Motor General Traders & Anr. etc. etc. versus State of Andhra Pradesh & Ors. etc. etc.

Constitution. of India 1950 Article 14-Classification when constilutior.alAndhra Pradesh Bui/dings (Lease, Rent and EJ'iction) Control Act, 1960 Section 32 (b)-Whether •iolative of Articfe 14.

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A.ndhra Pradesh Buildings (lease, !~ent and Evic1ion) Control Act, 1960, Section 32 (b)-Act no/ applicable tiJ any building constructed on or after August J6, 1957-Provision whether violative of Article ~4 of the Constitutio11,

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lnte,.pretation of Statuteso

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D Constit11tionality of a statute--!f'hether n1ere ldpse of tin1e lend~ constitutionality to ·a pro11ision.

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Doctrine of seyerability-Section in a statute held viofath•e of Ariic/eWhether entire statute can be struck down.

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E On October 1, J95l the State of Andhra came into existence. The ·Madras Buildings (Lease, Rent and EvictiOn) Contfol Act, 1949 continued to be in operation in the State. The area known as Telengana was mCrged with Andhra and the new State of Andhra Pradesh came into existence on November 1, 1956. The Hyderabad House (Rent, Eviction and_Lease) Control Act, 1954 which was in force in the Telengana area continued to be in force in that area even after the new St'ate of Andhra Pradesh c~me info existence:

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By a notification dated May 9, 1956 isslled by the· Governnient of Andhra Pradesh, ail buildings in ihe Andhra area the construction of which was completed on or after October J, 1953 were eX:empted from· the Madras Act for a perio4 of three )'ears from the date of such completion. On Auiust 26, 1957 the State Government issued another notification under the Hydeiabad G Act exempting all buildings in the Telengana Area for a period of five Years. Both the Madras Act and the Hyderabad Act were repealed ·and replaced by the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control ACt, 1960, which was passed in .1960. · si:ctioD 32 of the Act provided that the Act would not apply (a) to any building· Owned.by the Government, (b) to any building constructed on and after 26th August, 1957.

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The constitutionality of sec. 32 (bJ was questioned in a writ petition filed in 1964, in the High Court on the ground that it violatt'd Art: 14 of the Constitution. That petition was dismissed by the High Court on Jan~ary s, 1965

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595

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M,0, TRADERS V. ANDHRA PRADESH

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(Chintapalll Achalah v. P. <Jopa/akrishna Reddy, A.I.R. 1966 A.P. 51) upholding the validity of sec. 32 (b). The High Court held that the hardship caused .to . the tenant by the exemption given in the case of buildings constructed after • August 26, 1957 under sec. 32 (b) of the Act was 'short lived' and the conces1ion should be tolerated for a short while.

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In their writ petitions to this Court the petitioners assailed th~ constitu·tional validity of sec. 32 (b) of the Act contending that the buildings to which the Act was applicable were aged more than 26 years and those to which the Act was not applicable were aged about 26 years or less and during the 26 yoars from Au&ust 26, 1957 thousands of buildings had been constructed enjoying immunity of ihc Act, thai on ccount of the exemption, there were two sets of buildings in every area those· to which the Act v.as applicable and those which were exempted under sec. 32 (b) and there had ·also come into ·existence two classes of landlords-one class governed by the Act and the other not governed by the Act and two classes of tenants-one class having the Protection of the remedial provisions of the Act and another class which did not have.such protection, and that whatever might have been the position. in the first few years after the Act was passed there was no justification for continuing thi6 exemption for all tim to come.

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The writ petitions Were resisted by the State Government and the landlorlfs, on the ground that §I.pee sec. 32 (b) was valid at the commencement of the Act. as held by the High Court in the year 1965 it could not be .struck down 3.t any time after it had came into force. If clciuse (b) of sec. 32 was invalid then the entire Act would have to be struCk down, so that all the tenancies might be regulated by contracts entered into by the parties in accordance with their free will. They alsurged thats. 32 {b) was not violative of Article 14. The State Government also sated that two attempts were made to get the Act amended ·but that they failed. In the first Bill it was proposed to substitute the date '26th August 1957' in sec.' 32 (b) by the date 'the 1st January, 1968'. In the second Bill it was propo.sed to confine the exemption · in respect of each buiming to a period of ten years after its construction.

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Allowjng the writ petitions.

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HELD : I. ClauS< (b) of sec. 32 of the Act should be declared as violative of Article 14 of the Constitution because the continuance of that provision on the statute book would imply the creation of a privileged class of landlords without any rational basis, as the incentive to build which provided a neus for• a reasonable classification of such cl•ss of 1andlotds no longer existed by lapse of time in the cast:'. of the majority of such landlords. There was no reason why, after· ":11 these years, they should not be brought at par. with other landlords who were subject to the restrictiOns imposed by· the Act in the matter of eviction of tenants and control" of rents. [69 B-C] · ·

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The burden of proof regarding the question that a piece of legislation is violative of Art. 14 was, no doubt, on the petitioners. That burden stood discharged by them in the· instant cases. The impugned provisions had at any rat4' become per se discriminatory because it was not possible t~ support

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(1984) 1 s.c.R.

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596

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SUPRl!ME COURT REPORTS

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the exemption· giv~h to buildings which had also now becoine old as ·many of them were now more than 10 years old. The State Government itself had made ,two abortive ,attempts to get the section·amended. (604 G·H] . .

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Many of the exempted buildings were more than ten years old. While.there ·Was some justifica.tion for exen{pting new buildings which were say five, se-ven or ten years old from the date of the Act, in order to provide an incentive to builders of new buildings, there was hardly any justification to allow buildings. which we[e constructed more than. ten years ago to remain outside the scope of the Act. The landlords of such buildings must- have realised a large part of the investment .made ·on such buildings by way Of rents· during all these years .... The_colirt could not· fail to ·t.ake into account that oWing to continuous influx or population into urban areas in receni years the re~ts had gone up everywhere and that the landlordS of _such buildings had been able to- take advantage of the situation created by the shortage of urban housing accommodation which was a universal phenoinenori. Jn the case of these buildings there was no longer any need to continue the exemption.

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· [605G-606A].

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There could not. be any valid justification to apply the Act· to a· D building which was 27 years old. and not to apply it tO a building wbjch was 26 years old. The anamoly brought about by sec. 32(b) would be more pronOuncd · when the State Government by a notification brought the Act into force in any part of the State for the first time. On S¥ch extension of the Act only buildings Constructed prior to August 26, ·1_957 in that part of the State "¹ ould -become subject to the Act and buildings constrUcted later would -still be exempt from its operation. This was a Wholly insupp«Mtable classification. _The classifica·"" E tion of buildings into two classes .for purposes of sec. 32 (b) or the Act, therefore, did not any longer bear any relationship to the object, since the buildings which were exempted had already come into existence and their · owoCrs had ·realised a major part of their invesm~nt. [606 B·D]

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In the instant case, the legislature while passiDg the law had given the exeinption apparently as an incentive t6 encourage building activity. It was not shown how .the continuance of the exemptioa in the case of persons who had 9u.ilt houses more than two .decades ago would act s an incentive to builders of new houses now. IF that was so, then there was no justification to continue to liave the restrictions imposed by the_Act on buildings built prior to August 26, 1957 also and the who! Act should have to be repealed, for if· the impugned exemption could act as an incentive the repeal of the• Act should 1 · also act as an incentive. [613 G] -

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· 5. (iJ The long period that. had elapsed after the pas:;ing of the Aci itself served as a crucial factor in deciding the questicin whethur the impugned la;, had become discriminatory Or not because the ground on which· the classific"ation of buildings into two categories was made was not a historical or geographical ohe but was an economic one. Exemption 'Nas granted by way of an incentive to encourage b1,1ilding activity and "in the cirGumstancC~ s~ch exemption could not be allowed to last for ever. [613H·614] ·

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597

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M.G. TRADERS V. ANDHRA PRADESH

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0 (ii) The landlords of buildings constructea subsequent to August 26,. 1957 were given undue preference over the landlords of buildings coristructed prior to that date in that the former wCre 4 free fro_m ·the shackles of the Act while the latter were subjected to the i-estrictions imposed by it. What should. have been just an incentive 'bad become· a permanent b6nanzain favour of those who constructed buildings subsequent to Augtist 26, 1957. There being Do justification for the continuance of the benefit to a class of persOns without any rational basiS· whatsoever, the evil effects flowing from the impugned exemption had caued more harm to the society than one could anticipate. What was justifiable durng a short period had -turned out to be a case of hosti_le discrimination by lapse of nearly a quarter of century. [61~ D-EJ

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(iii) Mere lapse of time~ did not lend constitutionality to a pi'ovision 4'Vhicb was otherwise bad. The garb ~f constitutionality which it lnay have possessed earlier had become worn out and its c.onstitutiona1ity had been now brought to a successful challenge. [614 G] ·

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The striking down of clause (b) of sec. 32 of the Act did not in any wayaffeCt the rest of the provisions of the Act. The clause was not so iilextricably bound up with the rest of the Act as to inake the rest of the Act unworkable after it was struck down. Haying regard to the history of .the legislation the Ac_t had to be Sustained even after> striking down cluse (b) of sec. 2 . . The effect of striking down the impugned provision would be that all buildings, ecept those f3.lling under clause (3.) Or sec. 32 or exempted under sec. 26 in the areas where the Act was in force, woLild be governed by the Act irrespective of the dato of their construction. [618E-619AJ ·

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Chihtapalli Achaiafi v. P. Gopafiikrishna Reddy, (A.LR. 1966 Andhra Prad~Sh ·51) overruled .

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Shri Ram Krishna Dalmia v. Shri Justice S.R. Tendolkar &~ Ors. [1959) s:c.R. 279; Bhaiya/QJ ~hukla v. State of Madh}·a Pradesh (1962] Supp. 2 S.C.R. 257; State of Madhya Pradesh v. Bhopdl Sugar Industries Ltd., [1964] 6 S.C.R. 846; Vish;.,esha Thirtha Swamiar & Ors. v. Stale of Mysore & Anr. [1972) IS.C.R. 137; H.H. Shri Swamiji Qf Shri Admar Mutt etc. v. The Commi$sioner Hindu Religious & Charitable Endowments Department & Ors. [1980] l S.C.R. 368; Narottam Kishore Dev Vernra & OrS. v. Union of India & Anr., [196417 S.C.R.. 55; R.M D. Chamarbaugwa/la v. The Union of India [1957] S.C.R. 930; and D.S. Nakara & Ors. v. Union of India (1983] l S.C.C. 305 referred to.

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'(l) The incentive to build proyide~ a rational basis for classification and it is necessary, in the national interest, that there should be freedom from restrictions for a limited period of time. It is a.'tways open to the State Legi . Iature or tht State Governmedt to take· action by amending the Act itself or under sec. 26 of the Act, as tle case may be, not only to provide incentive to persons who are desirous of building new houses, as it serVes a definite social purpose but '.'also to mit!gate the rigour to such class of landlords who n1ay have recently built their houses for a limited period as it has been done in the Qnion Territory of Chandigarh. [619 E-FJ •

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(1984) 1 S.C.R.

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_M/s. Punjab Tin Supply' Co., Chandltarh e,ti:._ v.* TJ1e Central Government . & Ors., [1984] I S.C.R. p. 7.

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(ii) ·The question whether new legislation should be initiated to exempt newly constructed buildings, for a limited period of time on the pa.ttern of similar legislation undert.ak~n by different States or to exempt such class of bilildings for, a given number of years from the provisions of the Act by the B issue of a notification under sec. 26 of the Act is for the State Government to ·decide. [619 G-HJ •

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ORIGINAL JuR1m1CTJON : Writ .Petitions Nos. 737 of I 979, 242 of 1980, 5316, 3974 and 7902-03 of 1983.

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(Under article 32 gf the Constitution) ...

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K. R. Chodhary, K. Rajendra Chodhary, A. Subba Rao, C. S. Vaidyanathan, C. S. S. Rao, Mrs. Baby Krishnan, A. V. Rangam, T. V. S. N. Chari, .JJ. Kanta Rao and S. Markandeya for the appearing parties. ~

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The judgment of the Court was delivered by

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VENkATARAMIAH. J. The constitutional validity of clause (b) of section 32 of the Andhra pradesl:i Buildings (Lease,Rent and Eviction) E Corytrol Act, 1960 (Act XV.of 1960) (hereinafter referred•to as 'the Act') which exempts all buildings constructed on and after August 26,1957 from the operation of the Act is challenged in thesepetitions • under Article 32 of the Constitution. -

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On October 1,1953, the State of Andhra came into existence F under the provisions of the Andhra State Act, 1953 comprising the are.f specified in section 3 of that Act which formerly formed a part of · the then State of Madras. By virtue of the provisions contained in Part VI of that Act, the Madras Buildings (Lease and Rent Control) Act, 1949 (Madras Act XXV of 1949) continued to be in operation in the · G State of Andhra. On November 1,1956 under the States Reorganisation Act, 1956 with the merger of the area known as the Telangana area, which formerly formed a part of the erstwhile State of Hyderabad, with the territories of the State of Andhra the new State of Andhra Pradesh came into existence. By virtue of section I 19 of H the States Reorganisation Act, the Hyderabad House (Rent, Eviction and Lease) Control Act, I 954 (Hyderabad Act XX of 1954) continued to be in force in the Tclangana area even after the new State of Andhra Pradesh came into existence. In the Andhra area, the Madras

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M.O. TRADERS. v. ANDHRA PRADESH (Verrkatar.amiah, 1.)

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Buildings (Lease and Rent Control) Act, 1949 also continued to be in force. By a notification dated May. 9, 1956 issued by the Government of Andhra Pradesh under the said Madras Act, all buildings in the Andhra area, the construction of which was .completed on or after October I, 1953 were exempted from all the provisions of that Act for a period of three years from the date of such completion. Ort August 26, 1957 the State Government issued another notification under the Hyderabad Aci exempting buildings in the Telangana Area for a period of five years from the operation of that Act. Both the said Madras Act and the Hyderabad Act were repealed and replaced by the Act· which came to be passed in 1960. It appears that at the time when the Bill whi.ch later became the Act was being considered by the Joint Select Committee of the State Legislature, the Chairman of the Committee informed the Committee -that the 'Government of India had advised that new buildings should be exempted from the Act as it would be an incentive. to the house building activity and he also brought to its notice that the State Government had issued the above said orders exempting the new lmilding from the provisions of the respective Acts for a limited period. Thereupon Joint Select Commit· tee recommended that in order to afford an incentive to the house building activity, all buildings constructed after August 26,\957 should ·be exempted from the scope of the Bill. Ultimately section 32 of-the Act was enacted as follows'.· .

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.. •"32. Act not to apply to certain building~ :- The provisions· of this Act shall not apply :- (a) to any building owned by the Government; (b) to any building constructed on and after ·the 26th August 1957". ·

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-We are concerned with clause (b) of section 32 in these cases. It 'may be noted- that the exemption granted under clause (b) is not restricted to any specific peri,od as it was in the notifications issued under the repealed Acts. Now was it made applicable to new buildings · as suggeste4, by the Government of India by laying down a specific period during which they would be considered as new purposes of exemption. The constitutionality of this provision was questioned before the High Court of Andhra . Pradesh on the ground that it

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violated Article 14 ··of the Constitution in Chintapa/li Achaiah v P. A Gopa/akrishna Reddy(') in a petition filed in 1964. That petition was dismissed by the High Court on January · 5, 1965 upholding the validity of section 32 {b) of the Act. In the course of its judgment the High Court observed thus :

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B "The policy of the Act can be found out,. as discussed above, from all ·permissible intrinsic and extrinsic sources .. Thus examined, the policy underlying s. 32 is to provide an incentive to private efforts to construct new buildings; The Act read as a whole therefore balances the .policy underlying the main Act and the c policy underlying section 32. Thi• purpose cannot be said to be in any manner derogatory to· the main purpose of the Act; in faet it supplements it. It is true that the tenants of"the new buildings would suffer from the same hardship ... in order to redress which the measure was enacted. The. Legislature in its wisdom and perhaps with justification D. thought that this hardship to the tenant will be shortlived and compared to the necessity of bringing into existenu more and more new houses,for whichpurpwe the concession is shown has necessarily to be to erated for a short while in the interests of the entire bo.dy of tenants as the new E buildings are bound to bring down not only the hardships from whicli the new tenants would thus suffer but solve the larger problem of residential accommodation thus giving relief in all respects to the entire body of the tenants. It is for this purpose that it is now well-settled that the Legislature can recognise degrees of evil without F being arbitrary, unreasonable or in conflict with Art. 14 of the Constitution.'' (llnderlining by us)

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It may be noticed tbat the High Court felt that the hardship caused to the tenants by the exemption given in the case of buildings G constructed after August 26,1957 under section 32 (bl of the Act was 'short lived' and the concession should be tolerated for a short· while. But that was not to be so. The exemption has c9ntinued tb remain in force till now ,i.e. for more than a quarter of century. The problem of shortage of housing accommodation in urban areas; i& becoming H more and more acute. The landlar<h who earned their exemption

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(I) A.I.R: J966 Andhra Pradesh 51

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under section 32(b) of the have continued to enjoy for a Jong number of ~cars the freedom to indulge in malpractices which the Act was intended to check while others are·governed by the Act. The petition· ers have now questioned the· validity of the said provision before this Court. ·

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The Act except sub-section (2) of section 3 thereof applies to the cities of Hyderabad and Secunderabad and to all municipalities in the State of Andhra Pradesh. Sub-section (2) of section 3 of the Act applies to the cities of Hyderabad and Secunderabad and to any . municipality in the State or Andhra Pradesh if the State Government issues a notification to that effect. The State Government is authori. sed to apply all or any of the provisions of the Act except section 3(2) to any other area in the State of Andhra Pradesh. The Act was passed with a view to cons_olidating and amending the· law relatfog to the regulation of leasing of buidings, the control of rents thereof and the · prevention of.unreasonable eviction of tenants therefrom in the State ofAndhra Pradesh. '

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In view of section 32 (b) of the Act there are two sets of buildings in every area in which the Act is applicable-those to which the Act is applicable and those which are exempted under section 32 (b), leaving aside buildings owned by the Government and those exempted by any notification issued under section 26 of the Act. The buildings to which the Act is applicable are aged more than 2(i years and those to which the Act is not applicable are aged. about 26 years or less. During these 26 years from August 26, 1957 thousands of buildings may have been constructed and all of them are continuing to enioy the immunity from the provisions of the Act. The petitioners contend that on account of this exemption there have also come into existence two classes of landlords - one class governed by the Act and the· other not governed by the Act and two classes of tenants - one class • having the protection of the remedial provisions bf the Act and another class who . do not have such protection. . It is - argued by the petitioners that whatever may have been the position in the first few years after the Act was passed, there is no just'ification for continuing this exemption for all time to come. "'

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The State Government has stated tbat the object of granting the exemption was only to provide an incentive to the building activity. It is further pleaded in paragraph 6 of the counter affidavit filed on behalf of the State Government thus :

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(1984] '' i s.c.11.. '

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· · · "6. It was µnder active . consideration · of the Government subsequently regarding amending section 32 • (b) of the.Act so as to include: later constructions. Twice . bills were introduced in the. Legislature of the State but, . 'however, they could not be passed. The matter is again under active consideration. of the -Government; · The . proposal now under consideration by the Government is · · to extend the Act to all buildings after the completion of ,10 years of their construction .. Similar provisions ·are to be· found in the relevant Acts·of the States of Tamil Nadu and Karnataka. However, in the States of -Tamil Nadu and Kamataka, the. Act applies tq buildings five years after construction." · · -

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· Two attempti were made 'to get the Act amended but they failed. In Bill No. 33 of 1977 introduced in the Andhra Pradesh Legislative Assembly on iuly 'l:l,1977, it was proposed to substitute th~ date 'the D · 26th August; i957' in section '32(b) of the· Act by the ·date the Ist .· · January, 1968'. The said BiII lapsed on the Legislative Assembly 'being prorogi;ed on September· 2,1977. In the. BiII ·(L.A. Bill No. 12 of 1982) which wis iniroduced on July 26,. 1982 but which was not passed owing tci the dissolution of the Legislative .Assembly it ,was· proposed . to confine the exemption · in respect of each building .E to· a period of ten years ·after its · constructfon .. The statement of Objects and Reasons attached to that BIII is . insQ'uctive: The relevant. - . part ' - of ' it reads thus . ~ · . · ·

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. "Statenient ' ' of Objects and ~ Reasons. '' -'

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The Andi;;.a Pradesh Building (Lease,Rent and · Eviction) Control .Act, 1960 came into :rorce on the 21st . ·. April, · 1960 .· and . applies to buildings constructed- . ' · · prior to, the 26th ·August, , - • 1957 . . in • the twin cities 0 I of .

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.. Hyderabad and Secunderabad and other murucipalities in . the State: The number of buildlngs that' existed as on that date was ,adequate enough to serve the needs' of the popu·:

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)ation at that time. Such of the ·buildings as were in good

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' ' condition have already been ,requisitioned and have been .. · under the . control of the Government; The rest of the 'buildings are now' either in a' dilapidated .• condition or' ' under. the occupation of the landlords. Consequently, the · yov~ment are facing acute shortage ~f acco=odation ' '

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. M.o •. 'l'l}ADERS v. AND_HRA PRADEsH (Venkatramiah, J.) " 603
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. · 11;nd it has become almost impossiblefo requisition any
· old building'cf:!nstructed prior to the 26th August,1957 to •A
·meet the growing needs of the' Government .. It is, there-
fore, · proposed to extend the · scope of the Act· to all .
- buildings after the expiration of ten years from the .com-
pletion . - ' of their construction. . - . . .• ··
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B. Venkatram
. '· : Chief Minister"
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Although tberea.son givenfor.the amendment in the Statement ·c
of Objects and Reasons approaches the problein from the point of
view of the Government, it is c!Car that even the State Government.
is not quite. satisfied with the existing law._. . .

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··.' The etitioners principally rely upon Aticle 14 of. the Constitution in sup po.rt of their case: The equality clause contained in thai · · Article requires that all persons subjected to any legislati.on should be . treated alike under Jike circumstances and conditions. Equals· have to be treated equally 'and unequal> ought not to be treated equally. While that Article forbids class legislation, it des not ·forbid classification for 'purposes of implementing the right of uality guaranteed ... by it. In order however to pass the test of permissible classification two· · conditions must be .fulfilled, nameiy, {i) that the classification must be · · founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the' group and {ii) that that differentia must have a 'rational.: relation· to the object sought to be achived by the statute in'. question. While the classi · fication may be founded on: diffeent base what is 'necessary is that there must be a: nexus between ·the basis of classification and the . object of the Act under consideration .. The principles governing a valid classifiCation have been laid down by this Court in Shti Ram Krishna Da/mia v. Shri Justice S.R. Tfndo/kar & Ors.(1) thus : ' · • . " . - -· . - - - . - . . '-'(a) that a law may be constitutional even though it. relates to a single individual if, on account' of some special . . : / circum5tances or reasons applicable to him · and not . ·· · · · appiicable.to others, that· single individual. may be· . treated as a class by ·himself; - - . . . - '

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§04. SUPREME COURT REPORTS . · 119841 1 s.c.R. ' ..

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. (b) .·that there is always a presumptio~ in favour of the

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A. constitutionality of an enactment and the burden k

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. - upon him who attacks it to sliow that· there has been ·

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' a clear transgression of the constituti<mal principles; . .

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(c) that is must be presumed that the legislature underst. ands and correctly appreciates the ·need. of its own

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B ' '· people, that its laws are: directed to problems made · manifest by experience and that its discriminations

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• are based on adequate grounds; •

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(d) that the legislature is free to recognise degrees of harm · and may confine its .restrictions to those cases where the need is deemed to be the clearest; . . ' I . . ~ . • , . - lo

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. (e) that io order to sustain the presumption of constitu· . tionality the court may take into consideration matters • of com~on knowledge, matters . of common report,

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D. the history of the times a·nd may.assume every state ot .facts which can be conceived existing at the time of legislation; .and

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(f) that while good faith · and knowledge of .the

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E · existing conditions _on the part of a legislature are to be presumed, if there is nothing on the face of the law.or the surrounding circumstances brought to the

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-notice of the court on ._which the: classification may reasonably be regarded as based, the presumpticin of constitutionality cannot be ·carried· to the extent or"

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F . always holding that there must ,be some undisclqsed ·and unknown reasons ·for subjecting ·certain indi·viduals or corporations to hostile ·or· discriminating legislation." ~ · . · · ·

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G ·. The burden of proof regarding the question that a . piece of legislation is violative of Article 14 o(the Const.itution is, ·no doubt, on the pentitioners: That burden stands discharged by them in these cases.'it is seen that the impugned provision has at any rate become perse discriminatory because it is not possible to support the exemp-

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H tion given to buildings which have also now be~ome old as many of them are now more than ten years old. The State Government itself has already made two abortive attempts to get the section

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· amended.

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M.G. TRADERS v. ANDHRA PRADESH (Venkataramiah, J.) • 605

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The Law CommissionofAndhra Pradesh in its 24th Report on
the revisionofthe Act submitted in December,1977while expressing
·itsopinion on the clause relating to the amendmentofsection32(b)
ofthe Act observed thus: ·

¶199

I	"Sub-clause(v)isintended to exclude buildings, for a periodof10years from the date on which .their construc- tionis·completed, from the purviewofthe Act to ensure that the incentive to embark upon constructionofnew houses, whichisso necessaryatpresent,isnot sculled . . but encouraged. Exclusionofbuildings for a particular 'period~reckoned from the dateofcompletionoftheir. constructionisin - our opinion, a better course than providing that the proposed Act shall not applyto builidings constructed on or after a particular date, as the former would obviate the need for periodical amendment ofthe provisionifthe Act should continue to remain on the Stat.ute Book for a considerable lengthoftime."
	Inthe circumstances itisnot possible to say that the petition· -ers have not placed any material.insupportoftheir case. On the other hand the contesting respondenis have not placed any material in supportoftheir case that the impugned provision in its present form•does not violate Article14ofthe Constitution.
'y	Judged from the standards laid down in the caseof_ShriRam_ Krishna-Dalmia(supra)weareoftheviewthat the classificationof buildings for purposesofsection 32(b)ofthe Act does not satisfy-the true testsofa valid classification.Weare confronted in these cases with the position', say, in Hyderabad - city, that there are a large numberofbuildings which are more· than26years old whichare governed by the Act and quite a large numberofbuildings which are constructed subsequent to August 26,1957 which are exempted from it. Manyofthe exempted buildings are more than10years old. While it may be that there.issome justification for exempting new buildings say:whicharefive,seven·ortenye~rsold from the Act, in orderto provide an incentive to buildersofnewbuildings, there is hardly any justificationtoallow buildings which were constructed morethanten years agoto·remain outside the scopeofthe Act. The landlordsof such buildings must have realised a large partofinvestment made on such buildings bywayofrents during all these years. The -Court cannot fail to take into account that owingtocontinuous influxof

I

"Sub-clause(v)isintended to exclude buildings, for a
periodof10years from the date on which .their construc-
tionis·completed, from the purviewofthe Act to ensure
that the incentive to embark upon constructionofnew
houses, whichisso necessaryatpresent,isnot sculled
. . but encouraged. Exclusionofbuildings for a particular
'period~reckoned from the dateofcompletionoftheir.
constructionisin - our opinion, a better course than
providing that the proposed Act shall not applyto
builidings constructed on or after a particular date, as the
former would obviate the need for periodical amendment
ofthe provisionifthe Act should continue to remain on
the Stat.ute Book for a considerable lengthoftime."

Inthe circumstances itisnot possible to say that the petition·
-ers have not placed any material.insupportoftheir case. On the
other hand the contesting respondenis have not placed any material
in supportoftheir case that the impugned provision in its present
form•does not violate Article14ofthe Constitution.

'y

Judged from the standards laid down in the caseof_ShriRam_
Krishna-Dalmia(supra)weareoftheviewthat the classificationof
buildings for purposesofsection 32(b)ofthe Act does not satisfy-the
true testsofa valid classification.Weare confronted in these cases
with the position', say, in Hyderabad - city, that there are a large
numberofbuildings which are more· than26years old whichare
governed by the Act and quite a large numberofbuildings which are
constructed subsequent to August 26,1957 which are exempted from
it. Manyofthe exempted buildings are more than10years old. While
it may be that there.issome justification for exempting new buildings
say:whicharefive,seven·ortenye~rsold from the Act, in orderto
provide an incentive to buildersofnewbuildings, there is hardly any
justificationtoallow buildings which were constructed morethanten
years agoto·remain outside the scopeofthe Act. The landlordsof
such buildings must have realised a large partofinvestment made on
such buildings bywayofrents during all these years. The -Court
cannot fail to take into account that owingtocontinuous influxof

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. population into urban areas in rece;t )ears the rates of· rents have A gone up every where and t.hat the · landlords of· such buildings. have · been able to take advantage· of the situation createa by the shortage of urban housing ammodation which is now a. universal phenomenon. In 'the case of these buildings there is. no longer any need to . . . continue the exemption. ·There cannot be any valid. justification to .. B apply the Act to a building whlch is 27 years old. and not to apply it in the case of a building which is 26 years· old. ·The anomaly that is· . . brought about by ,section 32 (b) ortbe Act would be more pronounced wh the State Government by a notification brings. the Act· into force now in any part of tbe State for the first time. On such extension of the Act. only buildings con;tructed prior' to August 26,1957 in that c part of the State would become subject io the Act and later' buildings ~ · w~uld still bo exempt from its opertion. This is a wholly insu.PPorta· ble classification. The· classification of buildings into two classes for purposes of .section 32 (b) of.the Act,. therefore, does not any longer . · bear' any reiation-ship to the object, since· the'· buildings . which are exempted have already come into existence and their' owners have • realised a major part of their investment., -

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But i* was a;gued that since secti~n 32 (b) ~f the Act was 'alid · at the commencement of the Act as held• by· the . High Court iii the . year 1965; it cannot be struck down . at any time· after it hii.s come . E' into force. ·· ·· ·· ' • ·'"'

¶217

. What may be unobjectionable as a transitional or temporary

¶218

measure at an initial stage can still become discriminatory and hence vfolative of Article 14 of· the'. Constitution if it. is persisted in over a long period without any justification, The trend of. decisions of this.

¶219

F Court 011 the above que~tion may be traced thus. In Bhaiya/al Shukla

¶220

- v. State of Madhya Pradesh(') one 'of-the rontentions urged .was that the levy of sales tax in the area which was formly known as Vindhya · Pradesh (a Part 'C' State) on building matetiills us.ed in a ·works contract W;tS discriminatory after the merger Of that area in the new

¶221

G State of Madhya Pradesh which was formed ·on · N.ovember .. l,1956 under the States Reorganisation Act,. 1956 as the. sale <;>f. building materials in a works contract was not subject to any levy of.sales tax in another part of the same new State · namely the. area' which was· formerly part of the area kno.wn as State· of Madhya. Pradesh (tile Central Provinces and Berar area). That contention was rejected by this Court-with the following. observations ! • ' ' ' • ' at pages.274-275: •

¶222

(I) {1962) Supp. 28.C.R, ls7, .

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)d.G. TRADERS v. ANDHRA PRADESH .(Venkataramiah. J.)

¶226

607

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·'''(he laws in differen! portions of the new State of Madhya Pradesh were enacted by different Legislatures, and under . s. . 119.ofthe States Reorganisation Act all laws . ·~ . . . ·force arc to continue until . repealed or alt.ere<! by the • appropiate . Lgislature. We have already held· that the sales tax law in Vindhya Pradesh was validly enacted, and it brought its validity with it under s. 119 of the States . Reorganisation A:ct, when_ it became a part of the 'State of Madhya Pradesh. Thereafte.r, the different laws in different .parts of Madhya ·Prndesh can be sustained on the ground . that the ciifferentiation arises from historical reasons, and a geograP.hical classi.fkation based on historical reasons · has been upheld by this Court in M.K,. Prithi Rajji v. The State of Rajasthan (Civil Appeal No. 327 of.1956 decided . on November 2, 1960) and again in The State of Madhya . l'radesh v. The Gwa/i~r Sugar Co. Ltd. (Civil Appeals Nos: 98 and 99 ofl957 decided on No.vember 30, 1960), Tue latter case is important, because the sugarcane cess levied in the former Gwalior State but not in the rest of Madhya Bharat of which it formed a part, was c]J,allenged on the same ground as here, but . . . ~ . was upheld as not . a!fected by Art. 14. We,, therefore, reject this argument.''

¶228

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¶229

Then followed .the decision of this Court in State of Madhya Pradesh 'v. _Bhopal Sugar Industries Ltd._¹ ) In this case the continuance of the levy of agricultural income-tax ill the area comprised in·the former State of Bhopal (a Part 'C' · State) under the Bhopal State Agrlculturallncome-tax Act, 1953 (Act No. IX of 1953) even after its merger in the ne~ State of Madhya Pradesh formed on. November 1,1956 under ,the Srates Reorganisation.Act, 1956 when there was no such levy 011 agricultural income in some other parts of the new State of Madhya Par.desh was questioned on the ground that Article 14 of the Constitution had thereby been contravened. .The High Court of Madhya Pradesh upheld the plea, of the petitioner. On appeal this Court observed in the above case at pages.852-854 thus:

¶230

".Continuance of the laws of the old region after the reorganisation by s. 119 of the State.s Reorganisation Act was by itself not discriminatory even though it resulted in differential treatment of persons, objects. and. transactions

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(I) (1964] 6 S.C,R. 846 •.

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(1984) I s.c.R.

¶243

in the new State, .beca11se it was. intended to serve a dual purpose-facilitating the e'l!"IY formatin of homogeneous • · uniis i the larger interest of the Union, and maintaining even whiie merging its political identity in the new unit, the distinctive character of each region, till uniformity of laws .was secured in those branches in which it was . expedient after full enquiry to do so. : The Jaws. of the regions merged in the new units had_ therefore to _be · continued on grounds of necessity and xpediency. Section· . 119 of the States Reorganisation Act .was intended to serve · this temporary_purpose, viz., to enable the new units fo consider the special circumstances of the diverse units; before launching upon a process of adaptation of laws 80 as to. make them reasonably uniforin,. keeping in v!ew the special needs of the component r<igions and administrative efficiency. Differential treatment arising out of the application of the iaws so continued in different regions of the same reorganised State; did not therefore immediately attract the clause of the Constitutio_n prohibiting discrinli• nation: _But by the_ passtig~ _of time, considerations ofneces-_ . _sity and expediency would be obliterated; ilnd the gro1111ds which justified classification of geographical regions for hisiotical reasons may cease to be valid. A purely temporary. provision which because of compelling forces justified differential treatment when the Reorganisation Act was. enacted_ ' _cannot obviously he permitted to assume permanency, so as to ·perpetuate that treatme11t without a rational basis to support_ . _it after th_e initial expediency and necessity have disappeared._ ;,. ..... '. •...... ." ...... :~; ..... Ii would be impossible to lay \town · . any definite 'time-limit within which the Staie. had to make . necessary adjustments so as to. effectuate the equality clause_ of the · Constitiltio_n. That initially there was a valid geographical classification of regions ·in the same State justifying unequal laws when the State was formed . must be accepted. But whether the continuance of unequal laws by itself sustain~d the plea _of_ unlawful discrimination ·-in view of changed circumstances could only be ascertained after a full and thorough enquiry into the continuance of . tb.e grounds on which.the . inequality could rationally be . founded, and the change of circumstances, if any, which obliterated the 'compulsion 1>f epediency and necessity

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·M.G •. TRADERS v ANDHRA PRADESH (Venkata~amiah, J.)

¶257

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existing at the time when the Reorganisation Act was enacted."

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(Emphasis added)

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. The Court, however, found tht the pleadings in the cas.e were inadequate to decide whether Article 14 of the Constituion had been · actually violated or n:ot. It, therefore, set aside the judgment of the High court and remanded the case to the High Court to decide the . question afresh· after giving ihe parties the· opportunity· to amend their pleadings. This view was followed in Vihwesha Thirthil Swamiar & Ors. v. State. of Mysore & Anr.(¹ ) where this Court observed at page· 144 :· · · •.

¶264

"In vjew of the facts of this case, the temporary nature of the Acts and the pendency of the "resettlement and survey proceeding we cannot say that the Legislature · • . has acted contrary to the·provisions of Art. 14''. (Under• . linirig by us1 .

¶265

Then came the decisfon. of tlii~ ·Court in H.H. Shri Swamiji of • · Shri Admar Mutt etc. v. The· Cot11missioner, . Hindu Religious & Charitable Endowments Departm~nt & Ors.(') Ih . this case the continue application o.f the provisions of the Madras Hind ii Religious and Charitable Endowments Act. 1951 {Act No: 19.of 1951) in the .:irea which formerly . formed a part of the State of Madras prior to the States Reorganisation Act, 1956. and which later on becanie part of the new State of Mysore (now Karnataka) when a similar law was not in force fa.the other parts of the new State was ··challenged. Here again the material placed before the Couri was not sufficient to decide tlie question. The Court,. therefore, dismissed the appeal.. But Chandrachud, C.J .. speaking for the majority, however, observed at pages 387-388 thus :

¶266

"An indefinite extension and application of unequal laws for all time to come will militate against their true character as temporary measures taken in order . to serve·!! temporary purpose. Thereby, the very founda. tion · of their constitutionality . · shall have been destroy,ed, the foundation being that ·section 119 o(the . States Reorganisation !'-ct serve~ the significaftt 'purpose of

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(2) (1980] l S.C.R, 368.

¶277

610

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SIJPIU!ME COURT llBPOl\TS

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[1984) l s.c.it:

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givin!l reasonable time to the new units to consider the special circumstances· obtaining in respect . of divene units. The decision to withdraw the application of unequal· laws to. equal_s cannot be delayed unreasonably. because the .relevance of historical · reasons which justify the application of unequ~ laws is bound to wear out with the passage of time. In Broom's Legal Maxims (1939 Edition, Pago 97) can be ·found a useful principle, 'Cessante Rationc Legis Cessatlpsa Lex; that is to say, 'Reason is the soul of the law, and when the reason of any particular law ceases, so does.the law itself'.

¶288

We do not however see any. justification for holding . that the continued application of the Madras Act of 1951 to South Kanara District became violative of article 14 as immediately as during the period under consideration, which was just five or six years after the passing ofthe States Reorganisation Act. Nor indeed are we disposed to · hold that the continued application of that Act until ~ow· _is shown by adequate data to be violative of Article 14.

¶289

B_ut that is how the matter stands today. Twenty three years have -gone by since the States ·Reorganisation Act was passed b_ut unhappily, no serious effort has·been made by te State Legislature to introduce any legislation -apart from two abortive ·attempts in 1963 aild 1977to :remove the ineql)ality. between the temples and Mutts situated in the South Kanara District and those situated in other areas of Karnataka. Inequality is -so clearly writ large on the face of the impugned statute In its application to the District of South Kanara only, that it is perilously near the periphery of unconstitutionality, . We have restrained ourselves from declaring·the law as inapplicable to the District of South Kanara from·today but we would like to make it clear that if the Karnataka Legislature . does not act - promptly and remove the · inequality arising out of the application of the Madras Act of 1951 to the District of South Kanara only, the Act . will-have ta. suffer a serious and successful challenge in the not distant future. We do hope that the Government of Karnataka will act promptly and move an appropriate -legislation, s~y, within a year or so. A comprehensive

¶290

•·

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M.G. 'UADliRS v. ANDHRA PR~DESH (Venk11t11ramiah, J.} ~ . 611

¶292

legislatio~ which will apply to all temples · and Mutts .in .. Karnataka, which are equally situated in the· context of the levy of fee, may perhaps afford a satisfactory solution • .to ihe problem.. This, however, is a tentative view~point because we have not investigated whether t.he Madras Act of 1951, particularly section 76(1) thereof, is a piece of hostile legislation of the kind that would involve the violation of article 14. ·Facts in regard thereto rnay have · to be exPiored, if and when occasion arises."

¶293

The two grounds which persuaded this Court not· to. strike down the impugned legislation in the .above case as can ·be gathered from the above passage were (1) that the period under consideration was just five or six years after the passing of the States Reorganisation Act; 195.6 and (2) that there was no adequate data to decide the question whether the impugned legislatio.n did in fact make any hostile discrimination. Otherwis.e the Court would have iii all probability struck down the impugned provision of law ev.en though it had been continued by virtue of section 119 of the States ·. Reor~a!lisation Act, 1956.

¶294

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¶295

The above thre• cases arose under the States Reorganisation Act. In Narottam Kishore Dev Varma 8i. Ors. v. Union of India & Anr.(') the.petitioners who wished to sue·.the Maharaj\ of Tripur~, t)le former Ruler of the Princely State of Tripura ·Contended that section 87B of the Code of Civil Procedure which applied the provisions of section SS and of sub-sections (I) and Q) of section 86 · of the Code of Civil Procedure to a Ruler· of any former Indian State thereby· making the consent· of the Central Government a prerequisite for the trial' of a suit against such a Ruler, giving certain immunity to him as provided in sub-section (3) of section 86 and extending the provisions of section 85 to the case of such. a Ruler was violative of Article 14 and Article 19(1) (f) of ihe Constitution; After upholding the provisions on the ground that they were necessitated by historical reasons, Gajendragadkar, c.i. observed at page 60 thus : ·

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"Before we part with this matter, however, we would like to invite the Central Government to .consider seriously whether it is necessary to allow s. 87B to operate. prospec·tively for a// time; The agreement made with the Rulers

¶302

(1) (1964] 7 S.C;R. ss:

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. of Indian States. may, no doubt, have to be aecepted .and the assurance given to them may have to be. observed. Bu.t considered broadly in the light of the ha.sic pfincip!d of the equality before law, it seems ome. what. ode) that s. 87B should continue to operate for all time. For. past dealings and transactions, p;otection may justifiably be . given to Rtilers of former Indian States; but the Central Government may examine the question aflo whether for transatioris subsequent toth&26:th of January 1150, this. ·protection need or· should be continued. If under i!le Constitution all citizens are equal, it ·may be desirable io confine the operation of s. 87B to past transactions and not to perpetuate the anomaly of the distinction between the .rest of the citizens and Rulers of former Indian States. With the passage of time, the. validi/y. of. historical considerations on which s. 87B is founded will wear out and the cuntinuani:e of the said section in the Code of. Civil Pocedure may later bq open t serious challenge.'.' ·

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In all these cases' while it is true that no. provision was actually. struck down, there. is a firm foundation laid in support of the. pro~ · position that whatwas onc.e a non-discriminatory piece of legislation · may in course of tip:te become discriminatory' and be· exposd to a · successful challenge on the ground that it violated Article 14 of the Constitution. "Fhis is a sufficient answer to· the contention that· if at the tillle when the Act was enacied section 32(b) of the Act Was not unconstitutional, it cannot at ally time . thereafter be . challeng on the ground of unconstitutionality.

¶316

At this stage we shall deal with a very persuasive a~gument addressed by learned counsel for some of the respondents. Drawing. support from the·observations .jn· Bhopal Swar.lndustries Lti 's case (supra) and in H.H. Slzri Swamiji of Shri Admar. Mutt's case (supra) they contended thus. As in the above tw0 decisions this· Court had dCclined to strike down the impugned legislatiou as it found that ·there was nci adequate materia(to do so, in the cases before us also we' should follow the same course of action. The learned ... cciiinsel . ·· argued that the. State Legislature had deliberately, granted the exemption .in order to encourage construction .of new houses in vjew of the acute shortage of. housing . accommodation and• since the

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¶324

.... '. • • • • ' • -·• • • ·, • ·• • ".. • • I • • • -- • •;. -. shortage has become more and ·more • acute, the Court , should not · interefere with . tbe . legislative judgment' and allow the owners . of · · A buildings covered by section 32(b) 'of tlie Act to continue to enjoy the . I . -. 'exemption until there isevience to.show that there is no longer any' _, . such shortage, .· We find it difficult to accept this argument because ... .. it overlooks one essential distinction beiween the facts of those . two ' . ' · . cases and the racts of the present cases: Tue two.· <lecisions referred · B ·• •to above arose ill the context o(reorganisation'of States. Thc·State of: ..... . Madhya Pradesh was formed by integrating aeas which. formed parts. of the British India. and a.number ·of :Indian States;· Similarly .the ... State of Karnataka . was formed by . merging five ·integrating imits ..... . ·which again fonncriy formed parts 'oflhe British India · and Indian . SiateS.: 'There were on the. same subject faws of different patterns in . C: force in the sever~! integrating units· on·· the· eve of· reorganisation ... · · Those laws were al!6wed to continue in force as a·matter ofnecessitY •. · .. in the different. local. areas .untif. the . State ,Legislature' concerned : · .. .. · ·passed a..coxriin9n legislatlo11"0n each 'subject for the: whole State: The Legislature had to consider which.of the different laws· should be ·. D.. · . selected for enforcciment in the entire State ·either ·with.··~;. without·. · - .. modifications. This. certainly. needed enquiry and . investigation .. .. because of the diversities prevailing in· each reorganised State. · On . : .- .. enquiiy probabiy the. Legislature might have preferred to apply •the very legislation impugned beforethe Court for the ·entire State .. -Iri .. piese circumstances, this Court felt that _it was not possible to decide .. . . E . whether a particular law which was' challenged before them· was .. discriminator}' or not in. the absence of. necessary pleadings; and'. relevant niateriat•;,Jn the fastant cases, the·questiOn is 'not one. of· selecting any particular local law for extension to the other. parts of... ··a State. ''. ThiS iS a case liere the Legislature while passing the· 1a ·· had given· the exemption apparently. as an ·incentive to encourage · F ·bllilding activity: The learned Counsel \'ere not. able .to show how.. ' - .· . the 'continuance' of"the exemption in the cse of. persons· who' have : built housesmore tl:\an two decades ago will l;e(as an· incentive 'to .. builders of new houses now. If that is really so,·- then' 'there . is no : justification to ontinue to Iiave the restrictions imposed by the· Act .... 'G, . on bwldings built prior to August 26, 1957 also and· the whole Act .. should have to be repealed for if'the impugned exemption' can. aCt as ,_. an. incentive the repeal of the Act shouid also act as an incentive. . ., · · . We are of the ·view that in the' instant cases 'no 'investigation iis ., . contemplated in the above tWo decisions of this Court is necessary. H . : The long perio(! that has.elapsed after the passing of the Act itself . ' :serves as a crcial factor in deciding . the question: whether the .

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iiµpugned law has become discriminatory or.not because the ground · on which ·the classification of buildings into two categories is made is not a historical or geographical- one but is an economic one.· Exemption was granted by way of an inceniive io encourage building activity a.nd in the circumstances such exemption cannot be. allowed to.last for ever. • ·

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It is argued that sil!ce the impugned prov1s1on has been in · existence for over twenty three years and its validity has once . been . . upheld by the High Court, this Court should not .pronounce upon . its validity at this late stage. Ther~ are ·two answers to this pro' position. First, the very fact that nearly twenty three years are over c from ihe date of the.enactment of the impugned provision and the discrimination is ·allowed to be continued unjustifiably for such a .Jong time .is a ground of attack in these cases. As already observed, the landlords of the buildings constructed subsequent to -August 26, 1957 are given undue preference over .the landlords of buildings constructedprior to that date in that the former are ·free from the shackles of the Act while the latter are subjected to the ~estrictions. imposed by it, What should have been just an incentive bas ~ecome a permanent bonanza in favour of those who constr.llcted buildings. subsequent to August 26, 1957. There being no fustification for be continuance of the benefit to a class of persons without any rational E basis whatsoever, the evil effects flowing from the impugned exemption have caused more harm to the society ·than one could anticipate •.. Wha!was justifiable during a short period has turned out to be a case of hostile discrimination by lapse of nearly a quarter of century. The second answer to the above contention is ihat mere lapse of t\me does not lend constitutioniility to a provision which . is F otherwise bad. "Time does not run iQ favour of legislation. If it is.ultra vires, it cannot again legal strength from ·1ong failure on .the part of lawyers to percieve and set up. its-invalidity.· Albeit, lateness· . in an attack upon the constitutionality of a statute. is .hut a reason . for exercising special caution in. examining the arguments by which ihe attack is supported." (See W.A. Wynes:. 'Legislative Executive G and. JudiCial Powers in Australia' Fifth. Edition p. 33). We. are · constrained to pronounce. upon the validity of the impugned provisin at this late stage because the garb of constitutionality which . it may have possessed earlier has become worn out and its unconstitutionality is now.brought to .a successful challenge. H

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It was, however, contended on behalf of some of the ;~spondents (landlords) that if clause (b} of seci;on 32 of the "Act

¶350

M.G. TRADERS Y. AND!IRA PRADESH (Vtnkataramiah,. J)' 61 s

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was void then the ~ntire Act may be. struck down so that all the tenancies inay be regulated by contracts entered iDto by the parties in accordance with their free wilt. In other words it was submitted · - that even the limited operation of the rent ·control legislation in Andhra Pradesh on buildings constructed prior to August 26, 1957 may be lifted by declaring the whole Act as invalid on the ground that Legislature would not have passed the Act if it had known that . exemption could not be given for ever to buildings constructed on and after August 26, 1957 .. On behalf of the petitioners it was urged that the primary· object of the Legislature was to continue to give protei:tfon to the tenanis against .their. unre.asonable evictions from and recovery of Un.conscionable rents from them for· the buildings more or less on the. same lines as it was under the Madras Buildings . (Lease and Rent Control) Act, 1949 and H1e Hyderabad ,House· (Rent, Eviction and Lease) Control Act, 19,;4. which were in force in the two areas. of 1he State which were merged into one State on November I, 1956 and that in·any event clause (bY of Section 32 i.e .. the 9ffendiog provision alone can be .struck down without doing any · violence to the re.st of the statute. It was argued that the operation ofthe Act would in any way not be affected thereby and the only .result of striking down clause (b) of ~ection 32.would be that the rest of the Act. would become applicable to all buildings which are now exempted by dause (b) of section 32.

¶356

A statute bad in part is not necessarily void in its entirety; Provisions which are within legislative power and which are otherwise in ·confotmity with the Constitution may survive if they arc capable of being separa~ed from the bad. But a provision inherently unobjectienable cannot Ile deemed separable unless it appears both that, standing alone, legal effect can be given to it and that the · legis· lature intended the provision to stand, in case others included in the statute and held bad should fall. (See Dorchy v. Kansas 864 U.S. 286). The general rule is that when a pr6vision which is in the nature of an exception to a ·general statute is invalid, the general provisions of the' statute are not invalidated thereby,· unless it · clearly appears that the ·exception is so intimately and inherently related to and connected with the general provisions to which it· relates that the. legislature would not have enacted. the latter , without the former. The principles underlying the doctrine of severability are explainCd in. Cooley's Constitutional Limitations (Eighth Edition) Vol. I, at pages · 360-362 thus : · ·

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616 st!PRllME COURT REI'ORTS

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{1984) I S.C.R.

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. · "Where, therefore, a part of a . statute is uncousti·

¶367

. tutional, that fact does not authorise the courts. to ·declare· the remainder Void also, . unless.all the provisfons are connected. in.subject~matter, depending on each other;:.· operating together for the same purpose, or otherwise so connected together in meaning, that it cannot be presumed the legislature would have passed the one ·without the.

¶368

. other. 'The·constitutional and unconstitutional provision$' . may even be · contained in the same section and yet be ,. perfectly distinct and separable, so that the first may

¶369

'stand though the last fall. The ·point is not whether they are contained in the same section; for the distribution into sections is purely . artificial;. but . whether they are .. essentially and foseparably .. connected in substance. If, '

¶370

.. :when the unconstitutional portion is slrick~n out that ·which remains is complete in ·itself, and capable ·of .being .. executed in accordance with · the appareni legislative· ·

¶371

·intent wholly independent of that ·which .was rejected, it

¶372

. ·must be sustained."

¶373

After a review of the · law .on the doctrine of severability Venkataraina Ayyar, J. summadsed th.e principles governing the said doctrine in R.M.D; Chamarbaugwa//a v. The Union of India(') at pages 950-952 thus :

¶374

"!. In . determining ·whether· · the valid ·parts of a

¶375

·Statute are separable froin the invalid parts thereof it

¶376

. is the intention of the 1egislature tha.t is the deter min· ing factor. The test· to be applic;Q, is whether. the legislature would have enacted the valid part if it had known that the rest ·or the statute was .invalid. Vide Corpus ·.Juris Secundum, Vol. · 82, P · 156; . Sutherland on Statutory Construction Vol 2 PJ' .. 176-177;

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If the valid and invalid provisions are so inextricably , mixed up that they cannot be separated from one another, then the in.validity·of a portion must result·· in the invalidity of the · Act in its entirety .. On the. other hand, if they ate so distinct and separate that

¶380

(I) (1957) S.C.R. 930.

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M.G. TRADERS"· AND!IRA PRADESH (Venkataramiah, J) after striking out wbat is invalid, what remains is in itself a complete co.de independent·of the rest; then it will be upheld notwithstanding that the. rest lias becom.e unenforceable. Vide Cooley'.s constitutional • · Limitations, Vol. . 1 at PP. 360 7 361 ; Crawfor<! · on Statutory C<?nstruction, PP. 217-218. ' · ·

¶385

Even when the provisions which are valid are distinct and separate from th<ise which arc invalid, if they all form part of a single scheme which is intended to be · operative 'as a whole; then also . the invaiidity ot a part .will result iri the failure of .. the. whole. Vide Crawford on Statutory Construction, PP. 218'-219.

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Likewise, When the valid and invaiid parts of.a statute are independent.and do not form part of a scheme' but whai is Jeftaft~r omitting the invalid portion is so then and trunca\ed as to be in 'substance different frotp. what it was when it emerged out of the legislature, then also it will be rejected in its · entirety. · · • ·

¶394

s· The separability of the valid and ·invalid provisions of . a statute does.not.. depend on whether. ihe law is enacted in the .same . section or different sections; . (Vide Cooley's Constitutional Limitations,· Vol. J,. · PP. 361-362); it is not the form, but the substance. ofthe matter that is material, and that )las.to be ascertained ori an examination of the Act as a ·whole

¶395

·"and of the salting of the relevant provisions .. thereip. ·

¶396

If after the· invalid portion is expunged from the. statute what .remains cannot be enforced without making alterations and modifications therein, then the whole of it .must be struck . down as void, as . otherwise it will amount to judicial legislation. • Vide Sutherland on Statutory Construction,. Vol. 2,. p .. 194 ..

¶397

In determining the legislative intent on the '·question of separability, it will be legitirn"iite to take into ·

¶398

·.account the hi~tory of the legislation, .jts object; the · title . and the preamble to ii. Vide Sutherland on Statutory Construction; Vol.· ·2, PP. 177-178."

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SUPllBMI! COUB.'I' REPORTS ' I 1984) 1 S.C,J..

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Rejecting the contention that if ~y · striking down 'a provision . the class which is going to be affected is enlarged, the Court cannot ·strike down the impugned provis,ion alone, Desai J .. speaking on behalf of the Constitution Bench of this Court in D. S. Nakara & Ors v. Union of India(') at page 340 has.observed thus:

¶411

"Said the learned Attorney - General that prinCiple of severability cannot be applied .to augm'ent the class and to adopt his words 'severance always cuts.down the scope; never enlarges it'. We are n·ot sure whether there. is any principle wWch inhibits the court ·from striking down an · unconstitutional part of a legislative action· which may have the tendency to · enlarge the width and ·· coverage of the measure. Whenever classification is held to be impermissible and the measure can be retained by removing the : unconstitutional portion of classification, · by· striking down words of limitation, the resultant effect.m.ay be ot enlarging the class.· -fo such a situation, the court can strike down the words of limitation in an enactment.''

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On a careful consideration of the above .question in the'Jight. of the above principles we are of the view thatthe striking down of clause cb) of section 32 of the Act does not in any way affect the rest of ihe piovisions of the Act. The said clause . is not so inextricbly bound up with the rest of the Act as to make the rest of the Act unworkable after the said clause is struck down. . We art . also of the view that the Legislature would Iiave still enacted the .Act in the plaee of the Madras Buildings (Lease and Rent . Control) Act; 1949 and the Hyderabad House (Rent, Evictjon and Lease) . Act, 1954 which wefe in force in- the two areas comprised in the :. State .if Andhra Pradesh.and it could not have been its intention to deny the beneficial effect of those laws to the people residing i Andhra Pradesh on its formation. After the Second World War owing to acute shortage of urban . ho11sing accommodation, rent . control laws which were brought into force in different parts of India as places of temporary legislation gradually became. almost permanent statutes, Having regard to the history of the legislation under review, we are of the view that the Act has to be. sustained even after sfriking down clause (b) of section 32 of the ·Act. The ·

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(I) [1983) S.C.C. 305.

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'; . M.G. -~ . . TRADERS . v. ANDHllA PRADESH . . .- . . (venkataramilih, . J,) .. ·,6I9

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. effect c;>t:strihng don the itiipugnd ,provision would be .;that all . buildings except those falling, under clause '(a) of section 32 or . exempted und~r section ,26 of the Act .in the areas' :Where the Act is in .. . fciri:e will be governed by the· Act· irrespcctiveof the date of; their . ' . ~consinictio_ii. . .·· · . __·• . ·. • ~ . : : / f ... -·.. : . , ·

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•, . . . , '·•·"· '. '· .' . • .... , '• J .. I • . • ... : . (. Aftderbvina; qur iinxiousf chonsierathtion tolathe !e(ba)mefd ar~ent s . . '. B __ . . a ddr esse eiore .us, we are o t e view_ at c use o . ,section 32 - •. ·of the Act should'be ·declared as' violative of Article 14 'of the Constitution because the continuance or that provision on.the statute book will imply. the creation of a. privileged . class of latldlorcis . ,;ithout any rational baiis as the incentive to build' which provide a · . nexus for a reasonable classification. of •uch class of. landlords no. . .. c longer exists by lapse. of time in the· case of the majority o( such landlords. There is no reason why after all these·.years they, should·. 'not be brought atpar with otlier. landlords who are. subject to the restrictions imposed by. the Act in the. matter of eviction of tenants . . . and control of rents. • . ; '·. D

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· . We do realize the adverelfcet'of;his 'decision on many-wh~ . : 'may·_ hive recently built hoiises by spending their life savings or: by . ' • . . '. ·. orrowing large funds during these: inflationary days at high rates of · interst, on the expectation and belief that the.)I would not be subjected to the restrictions imposed by .the. Act: ·:The incentive to build · ,E : · ,E : · provides a'rational basis for classification -and it is. necessary, in the . national. interest; that there should be freedom from restrictions.for : ·"' limited period of time .. · It is always open' to the ·State. Legislature· . o~ the Siate Government to take action by amending the. Act itself or under section 6 of the Act, as the case may be, not only to povide. , inceiitiv~ to persons who are desirous of building new houses; as it ser· •. · F ' ves a definite social pu..Pose but also to mitigate the rigour fo such class of landlords who may have recently built their· houses for. a limited period as it has been done in the. Union Territory of Chandigarh as:. . brought. out in. our recent judgment m· M/s: . Punjab Tin. Supply Co . . · Chandigarh etc. v.'The Central Government.& Ors. (')The question ' 'G ·whether . new. legislation should . bC initiated to . exempt 'newly.. . constructed buildings for a limited perio<f of time on the. pattern of.': ·. simiJar legislation undertaken by'different ·_'States or to: exempt such · class of buildings for a given nu111ber of years from 'the provisions of' . · the Act by the issne or a notification under section -26 of the Act is . H . · one for the State Government to. decide .

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Jn.the result these petitions succeed. Clause (b) of sectioii<i2 · ;A .. of the Act is hereby declared as unconstituiional and it is ·quashed. · We, however, inake it clear that this dccl!U'ation would not affect the validity of any proceedings in which the. decree for eviction . passed by a civil court has become final and tlie .landlord has already· taken · possession of the building in question pursuant thereto. · .

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The petitions are accordingly allowed. No costs.

'.N.V.K.

Petitions allowtd •

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Motor General Traders & Anr. etc. etc. v. State of Andhra Pradesh & Ors. etc. etc.

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Motor General Traders & Anr. etc. etc. v. State of Andhra Pradesh & Ors. etc. etc.

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