No Fresh Notification Required To Apply Rent Control Act In Panchayat Area Converted To Municipality: Kerala High Court Full Bench

The Kerala High Court has held that no fresh notification under Section 1(3) of the Kerala Buildings (Lease and Rent Control) Act, 1965 is required to apply the Act, when a Panchayat Area is converted to Municipality.A Full Bench comprising Justice Sushrut Arvind Dharmadhikari and Justice Gopinath P and Justice G Girish was answering a reference which arose from conflicting Division Bench decisions on whether the conversion of a Panchayat into a Municipality interrupts the applicability of the Rent Act unless the State Government issues a fresh notification amending Schedule I.Ancillary issues included whether Schedule I to the Act is static until amended by the Government, or whether it undergoes automatic variation with changes in the status or territorial limits of local authoritiesThe present petition was filed by the tenants of a building seeking to stay the execution proceedings in EP No.402/2023 before the Munsiff Court, Kuthuparamba, including the delivery of possession of the building. They also prayed for a direction to the respondents not to take any coercive step based on the eviction order passed in the suit, and thereafter, confirmed in appeal and revision.The area upon which the building was situated was located in Koothuparamba Panchayat, which became a Municipality with effect from 01.04.1990. Therefore, the petitioners contended that even though the Rent Control Act was applicable to the Panchayat, the same would not automatically apply to the area, after its conversion to Municipality. According to them, a fresh notification under Section 1(3) is required to make the Act applicable to the Municipality.A prior Division Bench decision in Koorantakath Kamaludeen v. Kannyath Divakaran (OP(RC) 154/ 2024) had accepted this reasoning, prompting the reference.The Full bench observed that the object of the Rent Control Act is to regulate the leasing of buildings and controlling rents in respect of such leased buildings. It further observed that one of the principal aims and objectives of the Act was the prevention of unreasonable eviction of tenants from rented premises within the State of Kerala. The Schedule I to the Rent Control Act enumerated various villages, Panchayats, and Municipalities as the areas to which the provisions of the Rent Act apply. At the time of the enactment of the Rent Act in 1959, the State of Kerala comprised of only nine districts, whereas now it has increased to fourteen districts It was submitted that the Schedule I to the Rent Act continues to remain unamended and unaltered in its form and content. The Court examined the provisions of the Kerala Panchayat Raj Act, 1994 and the Provisions of the Kerala Municipality Act, 1992, which provides for the constitution of Panchayat and Municipality respectively to analyse the submissions made by both parties regarding the impact of alteration, conversion, or change in the status of Panchayat to a Municipality, or from one Municipality to another. The Court noted that even though the Rent Control Act was enacted in 1959, it could be enforced only in 1965, after the Presidential assent was obtained under Article 254 of the Constitution of India. At this point, both the Panchayat Act and Municipalities Act were in force, consequently, the concept of “Panchayat area” and “Municipality area” was incorporated into Schedule I of the Rent Control Act. The Court then went on to analyse section 1 of the Rent Control Act, particularly, Section 1(2) which mentioned that the Act applies to areas mentioned in the schedule and section 1(3) which enabled the government to extend, modify, or withdraw the Act's application to other areas by notification. The proviso to Section 1(3) states that no notification shall be issued unless it is supported by a resolution passed by the local authority or authorities, of the areas affected by the notification. The Court noted that even if Section 1(3) had not been enacted, and only Section 1(2) existed on the statute book, it would not have adversely affected or stultified the operation of the Rent Control Act. “Section 1(3) serves merely as a procedural provision relating to the applicability of the Rent Act. Under this section, if any area is to be added, modified, or withdrawn, it can occur only by way of notification and not otherwise. The proviso to Section 1(3) has a limited scope and cannot affect the operation of Section 1(2).” court noted. The Court observed that Section 1(2) is the charging provision of the Rent control Act which applies to all areas mentioned in the Schedule. The Court ruled that the proviso requiring a resolution of the local authority is confined to notifications issued under Section 1(3) and cannot be read into Section 1(2). By relying on the decision in Delhi Metro Rail Corporation Limited v Tarun Pal Singh [(2018) 14 SCC 161], and other precedents, the Court noted that a provision to any section cannot have an ambit, scope, or operation larger than the provision to...

No Fresh Notification Required To Apply Rent Control Act In Panchayat Area Converted To Municipality: Kerala High Court Full Bench

Anamika MJ

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