The Supreme Court on Tuesday struck down a notification of the Chandigarh Administration extending the East Punjab Rent Act to the Union Territory bringing small lease-holders also under its ambit.
Allowing a bunch of appeals by the affected tenants, a Bench of Justice SB Sinha and Justice PP Naolekar quashed the notification issued by Chandigarh Administration in November 2002.
The order would benefit about one lakh shopkeepers in Chandigarh, who were facing grim prospects of being evicted on a short notice under the Act extended to the Union Territory.
The court allowed the contentions of the tenants/shop-owners that a legislative provision could not be extended to the Union Territory by an executive order.
Under the notification, tenants paying a monthly rent of Rs 1,500 or less were made liable to be covered under the tenancy rules for filing of eviction suits against them before the Rent Controller.
Under the Union Territory of Chandigarh Act, 1974, tenants paying a monthly rent of 1,500 or less were out of the ambit of Rent Act.
The petitioners, mainly small shopkeeprs, had contended that making the East Punjab Rent Act applicable to them by an executive order was bad in law as it had not been ratified by the Legislature.
They said since Chandigarh was a Union Territory, any Rent Act applicable to it should have been passed by Parliament.