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Life Insurance Corporation of India Vs. the State of U.P. and ors. - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtAllahabad High Court
Decided On
Case NumberCivil Misc. Writ Nos. 4566 and 4573 of 1970
Judge
Reported inAIR1973All516
ActsUttar Pradesh (Temporary) Control of Rent and Eviction Act, 1947 - Sections 3; Constitution of India - Articles 12, 14 and 226
AppellantLife Insurance Corporation of India
RespondentThe State of U.P. and ors.
Appellant AdvocateS.D. Agarwal, Adv.
Respondent AdvocateStanding Counsel
DispositionPetitions dismissed
Excerpt:
(i) property - eviction of tenant - section 3 of u.p.(temporary) control of rent and eviction act, 1947 - grant of permission to file suit for ejectment - power of district magistrate not unfettered - power to be exercised keeping the object of the u.p.(temporary) control of rent and eviction act, 1947. (ii) principal of natural justice - article 226 of constitution of india - opportunity of personal hearing not given - held, not violative of the principles of natural justice. (iii) classification of nazul lands - article 14 of constitution of india and u.p. govt. order no. 6324 - h/xxxvii - 202 - 63 dated 03.12.1965 - classification based upon use of the premises for commercial or residential purposes - state government to determine the rate of premium for different classes - not to.....orderh.n. seth, j.1. by these petitions under article 226 of the constitution, the life insurance corporation of india seeks that the orders dated 12th of june, 1970, passed by the state government, dated 19th of november, 1969, passed by the commissioner, allahabad division allahabad and the government order no. 6324e/xxxvis-202-63 dated 3rd december, 1965 be quashed.2. briefly stated the facts leading to two petitions are that the petitioner life insurance corporation of india is a tenant in premises no. 40, mahatma gandhi marg, allahabad at monthly rent of rs. 333.67 and is carrying on the life insurance business therein. respondent no. 5, sri k. s. gandhi, is the landlord. the plot of land on which premises no. 40, mahatma gandhi marg stands was held on lease by sri k. s. gandhi......
Judgment:
ORDER

H.N. Seth, J.

1. By these petitions under Article 226 of the Constitution, the Life Insurance Corporation of India seeks that the orders dated 12th of June, 1970, passed by the State Government, dated 19th of November, 1969, passed by the Commissioner, Allahabad Division Allahabad and the Government Order No. 6324E/XXXVIS-202-63 dated 3rd December, 1965 be quashed.

2. Briefly stated the facts leading to two petitions are that the petitioner Life Insurance Corporation of India is a tenant in premises No. 40, Mahatma Gandhi Marg, Allahabad at monthly rent of Rs. 333.67 and is carrying on the Life Insurance business therein. Respondent No. 5, Sri K. S. Gandhi, is the landlord. The plot of land on which premises No. 40, Mahatma Gandhi Marg stands was held on lease by Sri K. S. Gandhi. Period of that lease has since expired. The State Government issued Government Order No. 6324-H/XXXVII-202-63, dated 3rd of December, 1965 laying down the principles for renewal of such leases. It provided that the persons wishing to get these leases renewed have to pay certain premium over and above annual rent. For this purpose the Government order classified land into two classes i.e. land used for commercial purpose and that used for non-commercial purpose. Rate of premium and annual rent payable in respect of land used for the commercial purposes is much higher than that for the land used for non-commercial purposes. It was considered that the plot, on which premises No. 40, Mahatma Gandhi Marg stands, was being used for commercial purposes. Accordingly, for getting the lease of that plot renewed Sri Gandhi was asked to pay a premium of Rs. 1,31,321.25 P. and rent at the rate of Rs. 964 per acre per annum. If, however, the plot was being used for non-commercial purposes, corresponding premium and annual rent would have been Rs. 23,950.32 and Rs. 100/- per acre per year only. Sri Gandhi accordingly made an application under Section 3 of the U. P. (Temporary) Control of Rent and Eviction Act, 1947 seeking permission to file a suit for the ejectment of the petitioner so that the disputed accommodation may be let out for residential purposes and he may not be forced to pay an additional Premium of Rs. 1,07,370.93 P. and the additional ground rent at the rate of Rs. 864 per are per annum.

3. The Rent Control and Eviction Officer, by his order dated 27th August, 1968 rejected the application for permission. He observed that in this case Sri Gandhi did not require the accommodation in dispute for bis own use and occupation. The main reason why he sought permission was that he wanted to reduce his liability in respect of payment of premium and ground rent. The Life Insurance Corporation had been in occupation of the accommodation for last many years and great hardship and inconvenience would be caused to the public and policy-holders in case it was evicted from the premises in dispute. In the circumstances, he was not satisfied that the need of Shri Gandhi was either convincing or justified. Accordingly, he rejected the application of Shri Gandhi.

4. In revision, the Commissioner Allahabad Division observed that the Rent Control and Eviction Officer had based his decision on the basis that the landlord did not require the accommodation for personal occupation. However, he omitted to consider the effect of the present occupation of the premises in dispute, by the Life Insurance Corporation. He concluded that so far as the landlord is concerned the effect of converting the accommodation into residential accommodation would be to put it to more profitable use. The Life Insurance Corporation was financially in a position to construct not only an office for itself but to have a building where many more offices could be housed. Any change in the location of the L. I. C. Office could not, in his opinion, cause inconvenience to public or the policy-holders. In the result, he found that the need of the landlord was more pressing than that of the tenant. Accordingly, he allowed the revision, set aside the order passed by the Rent Control and Eviction Officer dated 27th of August, 1962, and granted the permission sought for by Sri Gandhi.

5. Being aggrieved, the Life Insurance Corporation approached the State Government under Section 7-F of the U. P. (Temporary) Control of Rent and Eviction Act, 1947. The State Government affirmed the order passed by the Commissioner. It held that as the occupation of the accommodation in dispute, by the Life Insurance Corporation, obliged the landlord to pay an additional premium of Rs. 1,14,380/-, it would not be just to compel him to bear such a loss. It accordingly agreed with the Commissioner that in the circumstances, it would not be desirable to protect the interest of the tenant at the cost of landlord. In the result the State Government, by its order dated 12-6-1970, dismissed the revision filed by the Life Insurance Corporation.

6. In writ petition No. 4566 of 1970, the Life Insurance Corporation challenges the validity of the order dated 12th of June, 1970, passed by the State Government as also the order dated 19th November, 1968 passed by the Commissioner Allahabad Division, granting permission to Sri Gandhi for filing a suit for its ejectment. As the permission had been granted primarily on the ground that the continued occupation of the premises by the Life Insurance Corporation obliged Sri Gandhi to pay premium and ground rent at commercial rates as provided in Government Order No. 6324-H/XXXVII-302-63, the petitioner also challenged the validity of that order and urged that with regard to renewal of lease in respect of the plot in question, it was not open to the State Government to charge premium and ground rent at commercial rates. It also claimed that the Government order was discriminatory and was void as it contravened the provisions of Article 14 of the Constitution.

7. I will deal with the submissions made by the learned counsel for the parties in each of the two writ petitions separately. In writ petition No. 4566 of 1970 Shri S. D. Agarwal learned counsel appearing for Life Insurance Corporation, contended that in this case Shri Gandhi did not require the accommodation in dispute for his personal occupation. He wanted to file a suit for petitioner's ejectment so that he may be able to put the accommodation in dispute to more profitable use. Considering the policy underlying the enactment of U. P. (Temporary) Control of Rent and Eviction Act, no permission to file a suit for the ejectment of a sitting tenant could be granted so as to enable the landlord to earn larger profits. The permission granted by the learned Commissioner as affirmed by the State Government is therefore invalid.

8. Section 3 of the U. P. (Temporary) Control of Rent and Eviction Act lays down that no suit for ejectment of a tenant shall be filed without the permission of the District Magistrate from any accommodation except for one or more grounds mentioned therein. This section does not, in so many words enumerate the circumstances, which the District Magistrate is to take into consideration while dealing with an application for per mission to file a suit for tenant's ejectment. It is now well settled that the power so conferred on the District Magistrate is not unfettered. This power is to be exercised having regard to the purpose of the Act, which can be gathered from its preamble and other provisions. See Dr. Bhatia v. Victoria Rani Saheba, 1957 all LJ 267 = (AIR 1957 All 359); Ram Gopal v. Ram Kumar, (1962 All LJ 533) and Bhagwan Das v. Paras Nath, 1968 All WR (HC) 713 = (AIR 1970 SC 971). Whether in a particular case, the permission for filing a suit for ejectment has been granted in circumstances consistent with the object sought to be achieved by the U. P (Temporary) Control of Rent and Eviction Act or not, will depend upon the peculiar facts of that case.

9. Learned counsel for the petitioner contends that as disclosed by the preamble of the Act itself the object sought to be achieved by it is twofold, namely (1) the control of letting and rent of residential and non-residential accommodation and (2) to prevent the eviction of tenants therefrom. Various provisions of the Act indicate that the intention of the Legislature clearly was that the landlords may be able to take advantage of scarcity of accommodation and create situation in which they may be able to charge rent at a rate higher than that permissible under the Act. In other words, they should not be allowed to derive larger profits. As in this case permission to file a suit for ejectmenthas been granted in order to enable the landlord to derive larger profits, it runs counter to the object which the U. P. (Temporary) Control of Rent and Eviction Act seeks to achieve.

10. It is true that the object which the U. P. (Temporary) Control of Rent and Eviction Act 1947 seeks to achieve is to prevent the landlord from taking any advantage of scarcity of accommodation and to prevent harassment to the sitting tenants as also to see that the landlords do not charge rent in excess of what is permissible under the provisions of the Act. But, the Act nowhere lays down that so long as the landlord does not charge or intend to charge rent in excess of what is permissible under the Act, and he is not actuated by the motive of taking undue advantage of scarcity of accommodation, his affairs should not be so managed that he is able to derive maximum benefit from his property. In this case, it is significant to note that the landlord does not claim that he be placed in a situation where he can earn larger profits by charging higher rent. Even if he is able to get the accommodation vacated from the Life Insurance Corporation the premises in dispute would continue to be subject to the provisions of the U. P. Act III of 1947 (now by U. P. Urban Building Regulation of letting, rent and Eviction Act 1972) and it would not be possible for him to charge rent beyond the limit permissible under these Acts from persons to whom the accommodation will be allotted hereafter. All that the landlord claims to is that if the accommodation continues to be in occupation of a tenant, who is using it for commercial purpose, he will have to pay a premium of Rs. 1,31,000/- and odd, whereas if it is put in occupation of a person who will use it for residential purpose alone, his liability to pay premium would be reduced to Rs. 23,000/- and odd, similarly his liability to pay ground rent would also be reduced from Rs. 950/- per acre per annum to Rs. 100/- per acre. The petitioner has to incur this huge liability without getting any return for the huge amount to be paid by him. He does not want to take any advantage of scarcity of accommodation nor does he want to charge higher rent for the same. The accommodation would still be available for allotment to a person in need of it by the authority concerned and all that will happen is that the accommodation, instead of being allotted to a person who will use it for commercial purpose, will be allotted to a person who needs it for residential purpose. It is clear that by permitting the landlord in this case to file a suit for petitioners' ejectment, the Commissioner and the State Government do not enable him to take advantage of scarcity of accommodation to charge rent in excess of what is permissible under the Act. The permission has the effect of minimising the loss which the landlord is likely to suffer by reason of payment ofpremium and ground rent. Such a consideration, in my opinion, does not run counter to the object sought to be achieved by the U. P. Act III of 1947. I am, accordingly, of the opinion that there is no force in this submission and the two orders, one passed by the Commissioner and the other passed by the State Government, cannot be interfered with on this ground.

11. Sri Sudarshan Daval then argued that the order dated 12th of June, 1970 passed by the State Government is liable to be quashed as the same had been passed by following a procedure which was violative of principles of natural justice. According to him, after the petitioner filed an application under Section 7-F of the U. P. (Temporary) Control of Rent and Eviction Act on 9th of December, 1968, its copy was served on the landlord who submitted his reply which the Rent Control and Eviction Officer forwarded to the State Government on 24th of January, 1969. Thereafter, the State Government, by its letter dated 22nd of July, 1969, asked the Rent Control Officer to enquire from the petitioner whether it was prepared to increase the rent of the premises in dispute in such a manner that the landlord may not suffer any loss because of the excess payment which he is required to make to the government. The petitioner thereupon sent a reply dated 26th of August, 1969 stating that as the landlord had yet not paid the lease money, it was wholly vague to suggest that any loss is being suffered by him. In any case, so far as the petitioner was concerned, it was always prepared to pay such enhanced rent as and when it was determined in accordance with law for the time being in force. Thereafter, the petitioner filed a supplementary statement of its case before the State Government on 6th of October, 1969, praying that it be permitted to bring on the record and agitate facts and grounds in respect of its application under Section 7-F of the U. P. Act III of 1947. The landlord then filed a counter affidavit on 12th of November, 1969 in which the landlord stated certain new facts. However, a copy of this counter affidavit was not given to the petitioner and it was denied an opportunity to meet and explain those new allegations and to place its version before the State Government. Moreover, both the parties had desired that they be informed of the date on which the application under Section 7-F was to be considered so that they could make their respective submissions. On 14th October, 1969, the State Government made an order directing that the parties would be informed about the date of hearing of the application and that some date in the month of November would be fixed for that purpose. In spite of the order dated 14th October, 1969 the State Government decided the case on 12th of June, 1970, without taking any step to intimate to the parties concerned the date fixed for hearing in the case. Learned counsel contends that in the circumstances the decision of the case without communicating the date fixed for hearing in the case, violates principle of natural justice and renders the order invalid,

12. So far as the grievance of the petitioner that it was not given an opportunity to meet the case, set out by the landlord in his supplementary counter affidavit dated 12th November, 1969, is concerned, reliance was placed on the facts that in the supplementary affidavit, the landlord gave certain details of the loss which he was likely to suffer. Learned counsel contends that this fact assumed importance inasmuch as in the communication dated 28th July, 1969, sent by the State Government, requiring the petitioner to state whether it was prepared to make good the loss, which the landlord was likely to suffer on account of enhanced premium to be paid by him, no details of loss were mentioned and the petitioner, therefore, could not state clearly whether it was prepared to make good that loss or not. As a matter of fact the petitioner was and still is prepared to pay enhanced rent so that the loss which the landlord will suffer as a result of payment of enhanced premium and ground rent may be adequately compensated. During the course of argument, learned counsel for the petitioner also filed an application incorporating the said undertaking and contended that in the circumstances the order passed by the State Government granting permission after taking into consideration the additional material contained in the supplementary affidavit dated 12-11-1969 and on the ground that the petitioner was not prepared to compensate the landlord in respect of the increased premium and ground rent, is violative of principles of natural justice and should not be sustained. I am unable to accept this submission. Petitioner's reply dated 26th August, 1969 (Annexure 13 to the petition), to the query made by the State Government, clearly indicates that it took up the stand that as the landlord had not paid the lease money, there was absolutely no question of his suffering any loss and that the Life Insurance Corporation was prepared to pay only enhanced rent only when it is determined in accordance with law for the time being in force. This clearly indicates that the stand taken by the Life Insurance Corporation was that it was not concerned with the loss that tbe landlord was likely to suffer on account of payment of premium and ground rent at enhanced rate. From the very beginning the landlord was seeking permission to file a suit for petitioner's ejectment on the ground that if the premises continued to remain in the occupation of the petitioner, the landlord Will have to pay additional premium of over a lac of rupees and also ground rent at enhanced rate. The permission had been granted to the landlord on this very ground and this fact was in the knowledge of the petitioner throughout and it had full opportunity to meet it. In the circumstances, it cannot be said that the State Governmenthas granted permission on the basis of the material which had not been brought to the notice of the petitioner. I have carefully read the reply of the landlord, dated 12th of November, 1969. It does not contain any new ground or facts which the petitioner had no opportunity to meet. Even if it contained such grounds or facts it does not appear that they have been relied upon by the State Government. In the circumstances the question of breach of any principle of natural justice, on this account, does not arise.

13. So far as petitioner's contention that as on 14th of October, 1969 the State Government had directed that the parties would be heard in person for which some date in the month of November would be given, its action in deciding the case without intimating to the parties the date of hearing constitutes violation of principles of natural justice is concerned I am unable to accept the same. In the case of Triambak Pati Tripathi v. Board of High School and Intermediate Education U. P., (AIR 1973 All 1) (FB) a Full Bench of this Court observed as follows:--

'A personal hearing to the candidate against whom action is proposed to be taken by the Examination Committee is not necessary. There is neither any statutory requirement nor any requirement of principle of natural justice that the Board or the Examinations Committee has to give a personal hearing to the candidate.'

This shows that in the opinion of the Full Bench an order affecting right of the parties is not vitiated merely because the parties concerned have not been given a personal hearing. Accordingly, even if at one stage the State Government intended to give a personal hearing to the parties but after some time it changed its mind, it does not follow that any principle of natural justice has been, violated. It is not the case of the petitioner that after making the order dated 14th October, 1969 stating that a date of hearing would be fixed, a personal hearing was given to the landlord and not to the petitioner. I am accordingly of opinion that it cannot be said that any principle of natural justice has been violated by the respondent in deciding the case without giving a personal hearing to the, petitioner.

14. Shri S. D. Agarwal then argued that the order passed by the State Government does not give any reason and at any rate it did not consider the needs of the petitioner. It is accordingly liable to be set aside. I am unable to accept this submission. The order passed by the State Government clearly shows that it not only considered petitioner's need but it also compared it with that of the landlord and came to the conclusion that it was not a fit case in which the landlord should be made to suffer monetary loss of over Rs. 1,14,000/- on account of the occupation of the premises by the petitioner and that his interest is to be sacrificed. On this point, the State Government confirmed the decision of the Commissioner who had fully considered the need of the landlord as well as that of the tenant and had pointed out that the petitioner was in a position to construct its building in which it could house not only its own office but also several other offices and that shifting of its office was not likely to cause any inconvenience or hardship to the policy holders. In the circumstances, even though the State Government did not actually make a mention about the needs of the petitioner, it cannot be said that it did not compare its needs with that of the landlord and did not find the need of the landlord to be more pressing.

15. Shri S. D. Agarwal then argued that the Government Order dated 3rd of December, 1965 does not leave any option with the landlord to pay the premium at the rate applicable for renewal of lease for noncommercial purposes. Accordingly, whether or not Life Insurance Corporation is ejected and the disputed premises is used for noncommercial purposes, still the landlord will have to pay a premium applicable for renewal of lease for commercial purposes. Even if the landlord lets out the premises to some other person for residential purposes only, he will not be absolved of the responsibility of paying enhanced premium and higher ground rent. He will also not be able to charge from the new allottee rent at rate higher than that permissible under the Act. Accordingly, petitioner's ejectment will not help the landlord in reducing his loss in any manner. Accordingly, no question of granting permission to achieve the object set up by the landlord arises.

16. It may be noticed that the aforementioned contention urged on behalf of the petitioner has not been specifically raised in the writ petition. The State Government itself has proceeded on the footing that in case the petitioner is ejected and the premises in dispute is used for residential purpose, the landlord will have to pay lower premium and lower ground rent. If the point had been taken in the writ petition, the respondents would have had an opportunity to explain as to how it was open to the State Government to renew petitioner's lease for non-commercial purposes, thereby charging him premium and ground rent at a lower rate. In the circumstances, I am not inclined to permit the petitioner to raise this ground at this stage. Moreover, even on merits I am not satisfied that under law, if at the tune of actual renewal of lease the premises is being used for residential purposes it is not open to the State Government to renew the same on payment of premium and ground rent at the lower rate.

17. By the impugned order dated 3rd of December, 1965 (G. O. No. 6324-E/ XXXVII-202-63) while providing for the renewal of leases the State Government laiddown conditions on which such renewal was to be permitted. The rate of premium and the ground rent which was to be paid in respect of renewal of lease for the sites which were being used for commercial purpose was much higher than that for the sites which were being used for residential purposes. Clause 3 (2-F) of the order provided that sites occupied by Autonomous Corporate bodies doing businesses, such as the Life Insurance Corporation of India, should be treated as 'Commercial sites.' In writ petition No, 4873 of 1970 the petitioner claims that this notification is invalid inasmuch as it was not open to the State Government to treat the use of the premises in question, by the Life Insurance Corporation of India, as used for a commercial purpose. In any case by classifying the use of premises by Life Insurance Corporation, as commercial use, the Government has practised discrimination forbidden by Article 14 of the Constitution. Learned counsel for the respondents has raised a preliminary objection. He urges that the impugned notification does not touch the rights of the petitioner. It only affects the landlord who is required to pay a premium at a certain rate in case he wants to get the lease of the land on which his building stands, renewed. The petitioner, therefore, has no locus standi to question the validity of the notification which does not directly affect his rights,

18. As stated earlier, the petitioner has questioned the validity of the notification as permission to file a suit for its ejectment has been granted in view of and as a consequence flowing from that notification. In case it is held that this notification is invalid or ineffective, such a decision is bound to have repercussion on the validity of the order permitting the landlord to file a suit for petitioner's ejectment. In the circumstances, I feel that the petitioner has sufficient interest to maintain the present writ petition. The preliminary objection raised on behalf of the respondents is accordingly overruled.

19. A copy of the impugned Government Order, dated 3rd December, 1965 has been filed as Annexure I to the Writ Petition. This order lays down the principles for determining the amount of premium and ground rent payable by the persons applying for the renewal of lease of Nazul land, which has expired absolutely without option for further renewal. For this purpose the order classifies Nazul land into two classes viz. land used for residential purposes and that used for commercial purposes. It also lays down that the sites occupied by Central and State Government Offices as also those occupied by voluntary organisations like the U. P. Automobile Association and Servants of India Society should be treated as 'noncommercial' whereas sites occupied by Autonomous Corporate bodies doing business such as the Life Insurance Corporation of India should be treated as 'Commercial'.

20. Shri S. D. Agarwal contends that the Life Insurance Corporation of India is not a Commercial organisation and as such the Government was not justified in treating the site occupied by it as commercial site and to charge premium and ground rent on that basis. In my opinion it is for the State Government to determine what premium it would charge from the person to whom Nazul land is let out so long as it does not practice discrimination. It can certainly classify Nazul land into different classes and fix different rates of premium and ground rent payable for the grant of leases in respect thereof. Further, it can define what type of Nazul land would be included in a particular class. The provision in the order that the sites occupied by Autonomous Corporate bodies doing business, such as the Life Insurance Corporation of India should be treated as 'commercial site', indicates that the order contemplates that any site which is occupied for purposes of carrying on business is to be treated as a 'Commercial Site'. As is evident from Sections 6 and 28 of the Life Insurance Corporation Act, the Life Insurance Corporation carries on business in insurance and as such the activity carried on by it is commercial activity in the sense in which the expression has been used in the Government order. The provision in the order that the activity carried on by the Life Insurance Corporation would be treated as commercial, was made merely to clarify the sense in which the expression had been used in it. It cannot, therefore, be said that while giving the illustration in question, the State .Government included in the class of 'Commercial activity', an activity which was not at all commercial. This argument, raised on behalf of the petitioner, therefore, cannot prevail. Accordingly, it is not necessary for me to refer to the petitioner's argument that in view of the provisions contained in the Life Insurance Act, activity carried on by the petitioner, even though a business activity, was not commercial activity in the strict sense of the word.

21. Sri S. D. Agarwal then contended that The Government Order in question suffers from the vice of discrimination as it classifies land for purpose of payment of premium on the basis of the use to which it is put. He contends that according to the Government Order a lower amount of premium is to be paid in respect of the site which is being used for residential purpose, whereas in respect of an adjoining plot, situated in the same area and vicinity which is being used for commercial purpose, a higher amount of premium and ground rent is to be paid. Such a classification results in impermissible discrimination. In support of this argument he relied upon a decision of the Supreme Court in the case of Nagpur Improvement Trust v. Vithal Rao, Civil Appeal No, 2139 of 1968, decided on 11-12-1972 = (AIR 1973 SC 689). In that case,some agricultural land was acquired in pursuance of a housing accommodation Scheme framed under Section 39 of the Improvement Trust Act. The Supreme Court pointed out that the owner, whose land is acquired under the Improvement Act, is paid compensation not according to the market value but according to the use to which the land was put on the date, with the reference to which the market value is to be determined under that clause. In other words, if the land was being used for agricultural purpose, even though it had a potential value as a building site, the potential value was to be ignored. Further, if the land was being acquired under the Improvement Act, the person whose land was acquired did not get a solatium of 15% which he would have got if the land had been acquired under the Land Acquisition Act. It was open to the Government to acquire land for a housing accommodation scheme either under the Land Acquisition Act or under the Improvement Act. Since the Acquisition by the Government under the two Acts resulted in differential treatment, the Supreme Court observed that it enables the State Government to discriminate between two owners similarly situated. The Supreme Court then proceeded to observe that in order to determine the compensation for the land acquired, its classification on the basis of its user did not appear to be material. In this case, we are not concerned with the payment of compensation for acquisition of land. In my opinion, the observation made by the Supreme Court that for purposes of determining compensation, land cannot be classified according to the use to which it is put to, has no application to the facts of the case before me where the question is whether for purposes of charging premium and ground rent in connection with the lease of Nazul land, it can be so classified. I can see no valid objection to the charge of higher premium for renewing lease in respect of land which is being used for commercial or business purpose than that for the land which has been let out or is being used merely for residential purposes. Learned counsel for the petitioner has not been able to place any material before me to show that such a classification of land, for purposes of letting it out on payment of premium and ground rent, is irrational. It is well known that a property which is let out for commercial of business purposes, fetches correspondingly larger return than the property which is let out merely for residential purpose. I am accordingly of opinion that there is no merit in this argument.

22. Shri S. D. Agarwal next argued that the order is discriminatory inasmuch as in order to avoid payment of higher premium and ground rent, the landlord of the site occupied for commercial purpose is very likely to apply for and obtain permission for filing a suit for the ejectment ofhis tenant, whereas no such permission on similar grounds is likely to be granted in respect of land which is occupied by a tenant for residential purposes. This means that the tenants occupying sites for commercial purposes are being denied the protection given to all tenants under U. P. Act III of 1947 and are as such being improperly discriminated against. I am unable to appreciate this argument. The impugned order has absolutely no bearing on the tenancy rights of lessees. It does not purport to lay down that if there is a premises in the occupation of a tenant which is used for commercial purpose the landlord must get permission to file a suit for the ejectment of his tenant. Merely because while considering an application for permission to file a suit for tenant's ejectment, this fact may weigh and be taken into consideration along with other facts, it does not mean that the order permits discrimination forbidden by Article 14 of the Constitution.

23. It was then argued that the State Government should have given an opportunity to the Life Insurance Corporation to have its say in the matter before it classified the site occupied by it as commercial site. No law was brought to my notice Which lays down that such is the legal requirement before an order of the nature which is impugned before me can be made. In this connection learned counsel relied upon the case of A. K. Krainak v. Union of India, AIR 1970 SC 150, which in my opinion does not help the argument advanced by him. What the Supreme Court laid down in this case is that the dividing line between an administrative power and a quasi judicial power is quite thin and is being gradually obliterated. For determining whether a power is an administrative power or a quasi-judicial power, one has to look to the nature of the power conferred, the person or persons on whom it is conferred, the framework of the law conferring that power, the consequences ensuing from the exercise of that power and the manner in which that power is expected to be exercised. In a welfare State like India which is regulated and controlled by the rule of law, it is inevitable that the jurisdiction of the administrative bodies is increasing at a rapid rate. The concept of rule of law would lose its vitality if the instrumentalities of the State are not charged with the duty of discharging their functions in a fair and just manner. The requirement of acting judicially in essence is nothing but a requirement to act justly and fairly and not arbitrarily or capriciously. The procedures which are considered inherent in the exercise of a judicial power are nearly those which facilitate if not ensure a just and fair decision. In recent years the concept of quasi-judicial power has been undergoing a radical change. What was considered as an administrative power some years back is now being considered as a quasi-judicial power. Accordingly, administrative bodies are also expected to function in a fair and just manner. This case does not lay down that in each and every case where an administrative order is made which may even remotely affect the rights of a party, he must be given an opportunity to be heard. Moreover, in the instant case the impugned order does not purport to affect any right of the petitioner and as such no question of giving it an opportunity of being heard before making the order arose. It was for the State Government to decide as to what premium and ground rent it would charge from persons who wanted to take from various classes of Nazul Land on lease framed.

24. In the end learned counsel argued that according to the impugned order itself, the sites occupied by the Central and the State Government Offices should be treated as non-commercial. The Life Insurance Corporation is an office of the Central Government and therefore there was no justification for treating it in a manner different from other Government Offices. I am unable to accept this submission. The Life Insurance Corporation is an autonomous Corporate body created under the Life Insurance Act. It is not an office of the Central Government. In this connection learned counsel for the petitioner relied upon the case of Shyam Lal Sharma v. Life Insurance Corporation of India, Bombay, 1970 All LJ 214, where it has been held that for purposes of Article 12 of the Constitution, Life Insurance Corporation is State. Article 12 of the Constitution defines the expression 'State' as including within its ambit all local or other authority under the control of the Government of India only for the purposes of explaining as to in what sense the expression has been used in part III of the Constitution. It does not mean that the local or other authority under the control of the Government of India, which may be 'State' for purposes of Part III of the Constitution is a Central Government Office.

25. In the result I do not find any force in any of the submissions made in either of the two writ petitions. They are accordingly dismissed with costs. The stay order dated 21st of September, 1970 as confirmed on 31st January, 1972 is vacated.


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