Ram Lal Kapur And Sons (P) Ltd vs Ram Nath And Others

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 476 of 1961

Decision Date: 18 April 1962

Coram: N. Rajagopala Ayyangar, Bhuvneshwar P. Sinha, P.B. Gajendragadkar, K.N. Wanchoo

In the matter of Ram Lal Kapur and Sons (P) Ltd versus Ram Nath and Others, the Supreme Court of India rendered its judgment on 18 April 1962, the opinion being authored by Justice N. Rajagopala Ayyangar, who was joined by Justices Bhuvneshwar P. Sinha, P. B. Gajendragadkar and K. N. Wanchoo. The petitioner in the case was Ram Lal Kapur and Sons (P) Ltd and the respondents were Ram Nath and the other parties identified as “others.” The decision is reported in the 1963 volume of the All India Reporter at page 1060 and in the 1963 Supplement to the Supreme Court Reports (Second Part) at page 242. The operative statutory issue concerned the Supreme Court Rules of 1950, Order XIII, rule 1, proviso (v), which deals with applications for special leave, the requirement of giving notice to the respondent, and the court’s power to condone delay. The headnote explains that the appeal originated from a judgment of a single judge of the Punjab High Court dated 5 January 1953, who had accepted a division‑bench decision that section 7A of the Delhi and Ajmer Rent Control Act, 1947, was unconstitutional and void. The appellants consequently filed an appeal under the Letters Patent, and while that appeal was pending before the Supreme Court, they filed on 5 January 1959 an application for special leave to appeal the single judge’s order; notice was not served on the respondent and the Court granted special leave ex‑parte. Subsequently the Letters Patent appeal was withdrawn by the appellants, but when the special leave appeal was scheduled for hearing the respondent objected, contending that the special leave application was time‑barred, that the four‑year delay was not justified, and that the ex‑parte grant of leave should be revoked. The Court held that, given the peculiar circumstances, the special leave should not be revoked, but it observed that in rare cases the Supreme Court should not condone such delays ex‑parte and should require that notice be given to the respondent, allowing the latter an opportunity to oppose the grant of leave, and it suggested that the Supreme Court Rules might be suitably amended. The judgment was delivered under the civil appellate jurisdiction, specifically Civil Appeal No. 476 of 1961, which was an appeal by special leave from a Punjab High Court (Circuit Bench at Delhi) judgment dated 5 January 1955 in Civil Miscellaneous Petition No. 71/D of 1954; counsel for the appellant included N. C. Chatterjee, Hardayal Hardy and N. N. Keswani, while counsel for the respondents numbered 1 to 3 was R. S. Narula. Justice Ayyangar pronounced the judgment, noting that the appeal by special leave challenged the single judge’s finding that section 7A was unconstitutional.

The Court observed that the provision of the Delhi and Ajmer Rent Control Act, 1947, referred to as the Act, had been declared unconstitutional because it violated the fundamental right to equality guaranteed by Article 14 of the Constitution. The first respondent, Ram Nath, owned a building in Delhi, and the appellant company was one of the tenants occupying a portion of that building. The appellant therefore filed an application before the Rent Controller in Delhi invoking Section 7A of the Act, seeking fixation of a fair rent for the portion it occupied. Although the proceedings that followed were complex and had a varied course, it was not necessary to recount every step. It sufficed to note that the Rent Controller computed the fair rent for the whole building at Rs 565 per month and consequently fixed the appellant’s share of the fair rent at Rs 146 per month. The Court further explained that, under the Act, the Rent Controller possessed jurisdiction to entertain an application for fixation of fair rent only when the building in question was constructed after 24 March 1947; if the building had been completed before that date, ordinary civil courts, not the Rent Controller, would have jurisdiction to determine the rent. Consequently, the date of completion of the first respondent’s building became a pivotal issue before the Rent Controller, and the authority recorded a finding on that point that was adverse to the first respondent. Dissatisfied with the Rent Controller’s order, the landlord‑first respondent appealed to the learned District Judge of Delhi, but the District Judge dismissed the appeal. The landlord then approached the High Court of Punjab under Article 227 of the Constitution, challenging the correctness and propriety of every finding made by both the Rent Controller and the District Judge. That petition was heard by a learned Single Judge of the High Court. Earlier, a Division Bench of the same High Court, in a series of cases reported as British Medical Stores v. Bhagirath Mal (1955) 1 LR 8 Punjab 639, had held that Section 7A of the Act was unconstitutional and void. Relying on that decision, the Single Judge set aside the Rent Controller’s order on the ground that the Controller lacked jurisdiction, without addressing other issues that might arise if the section were valid and the Controller possessed jurisdiction. Aggrieved by that decision, the appellant filed an appeal under the Letters Patent to a Division Bench of the High Court. While that Letters Patent appeal was pending, the appeal in British Medical Stores v. Bhagirath Mal was taken to this Court, and the appellant obtained special leave to appeal to this Court even though the Letters Patent appeal remained pending in the High Court. Subsequently, the appellant withdrew the Letters Patent appeal. The appeal in the British Medical Stores case was then heard by this Court.

The Court noted that a judgment dated 2 August 1961 had been issued, in which this Court reversed the decision of the Punjab High Court and held that section 7 A of the Act was valid. Consequently, the sole issue that the learned Judge had examined, and on which the revision petition of the landlord‑first respondent had been allowed, no longer existed; therefore the appellant was entitled to have his appeal allowed. The Court further observed that the learned Single Judge had not addressed the remaining objections raised by the first respondent to the Controller’s order fixing the standard fair rent payable by the appellant. Because those objections remained unattended, the Court ordered that the appeal be remitted to the High Court for disposal in accordance with law. Before concluding, the Court considered a preliminary objection raised by counsel for the landlord‑respondent concerning the hearing of the appeal. That counsel submitted that the special leave granted by this Court ex parte should be set aside because it had been obtained improperly. The factual background to that submission was as follows: the judgment of the learned Single Judge from which the leave was sought was dated 5 January 1955, and the application for special leave to this Court was made on 5 January 1959, that is, after a lapse of four years. The application therefore fell far beyond the period of limitation prescribed by the rules of this Court. Counsel for the respondent argued that there were no sufficient grounds to condone such a delay and that the leave should be revoked. The Court, however, declined to accede to the request to revoke the leave, noting the peculiar circumstances of the case. Counsel cited several decisions in which ex parte leave had been revoked at the stage of hearing an appeal on a respondent’s objection, but the Court found no analogy between those precedents and the present facts. First, there was no bypassing of the High Court because the appellant had filed an appeal under the Letters Patent and, during the pendency of that appeal, had applied to this Court for special leave. Second, there was no suppression of any material fact that would have been relevant to the grant or denial of leave, and the petition accurately reflected the position at the time it was filed. Third, it was apparent that had the delay not been condoned and had leave been refused in January 1959, the appellant would have pursued his Letters Patent appeal and could have approached this Court thereafter if the decision there had been adverse. In fact, the grant of special leave in these circumstances merely served to expedite the proceedings, and this Court therefore chose not to revoke the leave.

In this case the Court granted the petition for special leave because the appeal before this Court arising from the judgments in the case of British Medical Stores etc. was about to be listed for hearing, and the Court saw an advantage in having the appellant positioned to intervene in those other appeals. The citation for that case is (1) (1955) I.L.R. 8 Punjab 639. Considering these circumstances, the Court expressed the view that the special leave should not be withdrawn. However, the Court added a clarification that, except in exceedingly rare situations, it should become a settled rule that a delay in filing an application for special leave must not be condoned without the respondent being given notice. Before granting leave in such delayed applications, notice should be served on the respondent, thereby affording the respondent an opportunity to oppose the grant of leave. The Court explained that this approach is not only just but also preferable to having to entertain later applications to revoke leave on the ground that the earlier delay was improperly condoned many years after the leave was granted. Such later revocation could cause injustice to the appellant by depriving him of the chance to pursue other remedies that would have been available had leave been refused at the earlier stage. Consequently, the Court suggested that the procedural rules be suitably amended to incorporate this principle. As a result of this reasoning, the Court allowed the appeal and set aside the order of the learned Single Judge that had accepted the revision petition under Art. 227 filed by the landlord‑first respondent. The matter was remanded to the High Court to consider the respondent’s petition in accordance with law, with the understanding that s. 7 A of the Rent Control Act is a valid piece of legislation. The Court noted that the landlord‑respondent had not raised the constitutional validity of s. 7 A, and therefore directed that each party bear its own costs in this Court, while the costs in the High Court would be determined by that Court. The appeal was thus allowed, and the judgment was ordered to be reprinted.