Public Premises Act Overrides State Rent Control Laws

Source: Supreme Court

Why in News? 

The bench of Justices Vikram Nath, Sandeep Mehta and NV Anjaria in the case of Life Insurance Corporation of India & Anr. v. Vita (2025) held that once premises fall within the definition of "public premises" and a tenancy is legally terminated, unauthorized occupants cannot claim the protection of State Rent Control Acts and must face eviction under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971.

What was the Background of Life Insurance Corporation of India & Anr. v. Vita (2025) Case? 

• The case involved LIC seeking to evict Vita Private Limited from a flat in Mumbai. 
• Vita had become a tenant in April 1957, long before the PP Act came into force retrospectively from September 16, 1958, and before LIC's establishment. 
• When LIC initiated eviction under the PP Act after terminating the tenancy, Vita resisted, claiming protection under the Maharashtra Rent Control Act. 
• In 2014, a two-judge bench in Suhas H. Pophale v. Oriental Insurance Co. Ltd. created a distinction based on the date of tenancy, protecting tenants who entered before the premises became "public premises." 
• The Suhas Pophale judgment held that the PP Act could not be applied to tenants who were in occupation of premises before it became "public premises" (i.e., before it was acquired by a government entity like LIC or a nationalized bank). 
• For such occupants, the protective umbrella of the State Rent Control Act was held to continue to apply. 
• The Bombay High Court, relying on the Suhas Pophale (2014) ruling, sided with the tenant and quashed the eviction order, prompting LIC to appeal to the Supreme Court. 
• In view of the divergence of opinion with the earlier Constitution Bench judgment in Ashoka Marketing Ltd. v. Punjab National Bank (1990), a two-judge bench referred the matter to a larger bench for an authoritative pronouncement.

What were the Court's Observations? 

• The judgment authored by Justice Anjaria criticized the High Court for failing to adhere to the doctrine of stare decisis while ignoring the binding precedent of Ashoka Marketing Ltd. (1990), delivered much before the decision of Suhas Pophale (2014). 
• The Court held that the PP Act is a later and special law designed specifically to deal with unauthorized occupation of public premises and that it necessarily prevails over conflicting provisions of State Rent Control statutes. 
• The Court further held that the date on which a tenant entered the premises is irrelevant for determining the applicability of the PP Act. 
• The Court overruled the judgment of Suhas H. Pophale v. Oriental Insurance Co. Ltd. (2014), calling it an incorrect interpretation that contradicted the binding Constitution Bench precedent of Ashoka Marketing Ltd. (1990). 
• The Court reiterated key propositions of law from Ashoka Marketing Ltd. (1990) as follows: 
  • Both the PP Act 1971 and State Rent Control Acts are special laws. In case of conflict, reference must be made to the purpose and policy underlying the two enactments. The PP Act 1971 shall override the provisions in the Rent Control Legislations. 
  • The rule generalia specialibus non derogant will not apply between these two special enactments. Having regard to the purpose, policy and legislative intent, the PP Act 1971 would prevail over State Rent Control Acts in respect of eviction of 'unauthorised occupants' of 'public premises'. 
  • The provisions of PP Act 1971, to the extent they cover premises falling within the ambit of Rent Control Act, override the provisions of the Rent Control Act. 
  • A person in unauthorised occupation of 'Public Premises' under Section 2(e) of the Act cannot invoke the protection of the Rent Control Act. 
  • In cases where tenanted premises are claimed to be governed by the State Rent Control Act and have also become 'Public Premises', the PP Act 1971 will have application for their unauthorised occupation. 
  • The statutory machinery envisaged under the PP Act 1971 could be activated for recovery of possession of public premises by any Government or public entity mentioned in the definition. 
  • The PP Act 1971 applies to tenancies created and in existence either before coming into force of the Act or which may have been created subsequent to coming into force of the Act. 
  • Two conditions must be satisfied for applicability: First, the tenanted premises must fall within the purview of definition under Section 2(e) of the PP Act 1971. Second, the premises should have been in unauthorised occupation. 
  • Termination of tenancy of 'Public Premises' by issuing notice under Section 106 of the Transfer of Property Act, 1882 is one of the modes which would render the occupation of the tenant unauthorised. This would hold true for tenancies created before or after coming into force of the PP Act 1971. 
  • Invocation and applicability of the provisions of the PP Act 1971 is not dependent upon the aspect of possession. What is material is the occupation of the premises which has become unauthorised occupation. The occupation is a continuous concept.

What is the Public Premises (Eviction of Unauthorised Occupants) Act, 1971? 

About: 

• The Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (PP Act) is a special legislation enacted to provide for speedy eviction of unauthorized occupants from public premises. 
• The Act came into force retrospectively from September 16, 1958. 
• "Public premises" under Section 2(e) refers to premises owned or controlled by government entities, public sector undertakings, nationalized banks, insurance companies like LIC, and other specified public authorities. 
• The Act provides a summary procedure for eviction of unauthorized occupants without the lengthy procedures required under ordinary rent control laws.

Purpose and Objective: 

• The primary purpose of the PP Act is to enable quick recovery of public premises from unauthorized occupants to ensure efficient utilization of public property. 
• The Act aims to protect public interest by preventing unauthorized occupation of premises meant for public purposes. 
• It was designed to override the lengthy eviction procedures under State Rent Control Acts which often delayed recovery of public premises for years.

When Occupation Becomes Unauthorised: 

• Occupation becomes unauthorized when a tenancy is legally terminated through proper notice under Section 106 of the Transfer of Property Act, 1882 or through other lawful modes of termination. 
• Once the tenancy is terminated, continued occupation of public premises becomes unauthorized, triggering the application of the PP Act. 
• The Act applies regardless of when the original tenancy was created – whether before or after the premises became "public premises" or before or after the PP Act came into force. 

Relationship with State Rent Control Acts: 

• Both the PP Act and State Rent Control Acts are special legislations, but the PP Act prevails in case of conflict due to its specific purpose and policy. 
• Once premises qualify as "public premises" and occupation becomes unauthorized, tenants cannot seek protection under State Rent Control Acts. 
• The PP Act's summary eviction procedure overrides the protective provisions of State Rent Control Acts for unauthorized occupants of public premises.