Kamal Cinema v. Lalit Talkies — 1979 DIGILAW 1061 (ALL)

JUDGMENT S.J. Hyder, J. - This first appeal arises out of the decree passed in favour of plaintiff-respondents by IInd Additional Civil Judge, Jhansi on Nov. 30, 1955. The connected execution first appeal No. 243/1972 has been filed by the defendant-judgment-debtors in the said suit. The two appeals can be conveniently disposed of by a common judgment. 2. The controversy in the first appeal lies in a narrow ambit, as the only question pressed on behalf of the defendant-appellant is that the lease-deed dated 29th Oct. 1953 is void under Section 23 of the Contract Act. 3. The suit giving rise to the first appeal was filed by plaintiff-respondents, inter alia, on the allegations that Lalit Talkies plaintiff No.. 1 was a partnership firm of which the other plaintiffs were the partners. The said firm owned a building known as Taraiya Building which is situated at Nazai Bazar, Lalitpur. The said building was being used for exhibition of films under the name and style of Lalit Talkies. It was also alleged that the defendant-appellant No. 1 Kamal Cinema is also a partnership firm and defendant-appellant No. 2 Dr. Deep Chand Jain was running the affairs of the said firm. On 29th Oct. 1953, the defendant-appellant took on lease the aforesaid building and a bilateral deed of lease was executed between the parties on the said date. By means of the said deed of lease the plaintiff-respondents demised the building of Lalit Talkies to the defendant-appellants on payment of Rs. 700 per mensem excluding municipal tax which were also to be borne by the defendant-appellant. The particulars of the demised property are given at the foot of the plaint. The plaintiff-respondents also stated that the defendants were in arrears of rent for a considerable period. A combined notice of demand and ejectment was given to the defendant-appellants on Sept. 26, J.960. The said notice was personally served on defendant-appellant No. 2 on Oct. 15, 1960. After the service of the said notice the defendants paid only a sum of Rs. 400 towards the arrears of rent and they had, thus, rendered themselves liable to ejectment. On the aforesaid allegations, the plaintiff-respondents prayed that they may be delivered possession over the demised property together with its appurtenance, equipment and fittings. They also claimed a decree for Rs. 41,891 on account of arrears of rent. 400 towards the arrears of rent and they had, thus, rendered themselves liable to ejectment. On the aforesaid allegations, the plaintiff-respondents prayed that they may be delivered possession over the demised property together with its appurtenance, equipment and fittings. They also claimed a decree for Rs. 41,891 on account of arrears of rent. Damages for use and occupation were also claimed at the rate of Rs. 700 per month. 4. The suit was resisted by the defendant-appellants on a number of grounds. They, inter alia, urged that the agreement of lease dated Oct. 29, 1953 was void under Section 23 of the Contract Act as it contravened the provisions of Cinematograph Act 1918. In view of the limited controversy which now survives between the parties in the first appeal, it is not necessary to refer to the other pleas raised by the defendant-appellants in their written statement. Suffice it to say, that the trial Court found in favour of the defendant-appellants on some of the issues arising in the case. It accordingly decreed the suit- of the plaintiffs-respondents for possession over the property in suit detailed at the foot of the plaint. It awarded a decree for a sum of Rs. 27,463.25 in favour of the plaintiff-respondents together with Samages for use and occupation at the rate of Rs. 700 per mensem from 16th Nov. 1960 to the date of delivery of possession. 5. Feeling themselves, aggrieved by the decree of the trial court, the defendant-appellants have preferred this appeal. 6. On behalf of the appellants, it has been urged that the property of the Cinema building together with the licence issued under S- 3 of the Cinematograph Act had been demised in favour of the defendant-appellants under the lease deed dated Oct. 29, 1953. It was urged that reading Sections 3, 5 and 8 of the Act together the conclusion is inescapable that the transfer of the licence was opposed to public policy and it was also in contravention of law. The lease dated Oct. 29, 1953 was, therefore, void under Section 23 of the Contract Act. In support of this contention reliance has been placed on Velu Padayachi v. Sivasooriam Pillai, AIR 1950 Mad 444 (FB) and K. Viswanathan v. Namakchand Gupta, AIR 1955 Mad 536 . 7. The same argument was also urged on behalf of the defendant-appellant before the trial court. 29, 1953 was, therefore, void under Section 23 of the Contract Act. In support of this contention reliance has been placed on Velu Padayachi v. Sivasooriam Pillai, AIR 1950 Mad 444 (FB) and K. Viswanathan v. Namakchand Gupta, AIR 1955 Mad 536 . 7. The same argument was also urged on behalf of the defendant-appellant before the trial court. It negatived the said contentions on two grounds. In the first place, it held that the licence granted to the lessors under Section 3 of the Act was not the subject-matter of the demise and had not been transferred to the defendant-appellants. It next held that in any view of the matter the deed of lease did not offend the provisions of the Act or the terms of the licence. The said findings of the trial court have been called in question before us. 8. We have gone through the lease dated 29th Oct. 1953 and we find that on a fair reading of the document it cannot be said that the licence to run the Cinema had also been transferred under the document in favour of the lessees. It however, appears that on the same date a Qabuliat was also executed by defendant-appellant No. 2 on behalf of defendant-appellant No. 1. The said Quabuliat has been filed on behalf of the plaintiff respondents and has been marked as Ex. 9. The said document inter alia, recites: - "I also agree and undertake to compensate fully for all expenses, injuries or losses occasioned to M/s. Lalit Talkies or any of its partners or proprietors by any cause whatsoever specially due to any prosecution for any breach of the Cinematograph or film rules etc. while I am running the cinema licensed in the name of Seth Jineshwardas Taraiya" 9. Our attention has also been invited to the statements of Jineshwardas Taraiya (P.W. 1). During the course of his cross-examination, he admitted that the rent of Rs. 700 was agreed between the parties not only in respect of the Cinema building, its appurtenance, furniture and fixtures but also for the licence which stood in his name and for the period that the said licence was current and effective. It is to be borne in mind that under R. 9 of the U. P. Cinematograph Rules, 1951, a licence is valid only for a period of one year. 10. It is to be borne in mind that under R. 9 of the U. P. Cinematograph Rules, 1951, a licence is valid only for a period of one year. 10. When the demise of the Cinema was made in favour of the defendant-appellants on Oct. 29, 1953 the licence in favour of Jineshwardas Taraiya was current up to 31-3-54. All that can be concluded from the admission made in the statement of Jineshwardas and the stipulation contained in the Quabuliat executed by defendant-appellants is that the defendant-appellants could continue to run the Cinema on the licence which stood in the name of Jineshwardas only up to 31-3-1954. The contention of the defendant-appellant that the licence of the Cinema was also the subject-matter of the lease is, therefore, incorrect. 11. In order to further appreciate the argument advanced on behalf of the defendant-appellants, the provisions of the Act and Rules framed thereunder may now be referred to. Section 3 of the Act lays down that unless otherwise provided in the Act, no person shall give an exhibition by means of Cinematograph elsewhere than in a place licensed under this Act or otherwise than in compliance "with any conditions and restrictions imposed by such licence. Section 5 of the Act deals with the restrictions on the powers of the licensing authority. The said section does not impose any restrictions on the property rights, if any, which a licensee has in the premises licensed under the Act. Section 8 of the Act is the penal clause- It inter alia provides that if the owner or person in charge of Cine-matorgraph uses the same or allows it to be used, or if the owner or occupier of any place permits that place to be used in contravention of the provisions of the Act or the Rules made thereunder, or of the conditions and restrictions upon, or subject to which any licence has been granted under the Act shall be punishable with fine which may extend to Rs. 1,000 and in the case of continuing offence, with a further fine which may extend to Rs. 100 for each day during which the offence continues, and his licence, if any, shall be liable to be revoked by the Licensing Authority. 1,000 and in the case of continuing offence, with a further fine which may extend to Rs. 100 for each day during which the offence continues, and his licence, if any, shall be liable to be revoked by the Licensing Authority. This penal provision is attracted only, if there is any breach of the provisions of the Act, the Rules framed thereunder or of -any term or condition imposed by the licence. 12. These provisions, in our opinion clearly postulate that' a licensee who has obtained a licence under the Cinematograph Act, 1918 can permit a non-licensee to give Cinematograph exhibition in accordance with the conditions of the licence granted to him. A copy of the licence has not been filed on the record of the case. Appendix I of the Rules, however, contains the form of licence under the Cinematograph Act 1918. A perusal of the contents of Appendix I goes to show that the conditions of the licence contained therein do not impose any such restriction which disentitles a licensee from permitting his lessee to give Cinematograph exhibition in accordance with the conditions of his licence. 13. The case of Velu Padayachi v. Sivasooriam Pillai (supra) is clearly distinguishable. The said case dealt with -the provisions of the Madras Abkari Act and the Rules framed thereunder. R. 27 -of the Rules framed under the Madras Act clearly contained a provision to the following effect: - "No privilege of supply or vend shall be sold, transferred or sub-rented without the Collectors previous permission." 14. Section 56 of that Act made punishable a contravention of any term of a licence or permit granted under that Act. It was in the context of these mandatory provisions that a Full Bench of Madras High Court came to the conclusion that an agreement to carry on business of vending liquor in partnership when the licence to vend such liquor had been granted in the name of one of the partners only was hit by Section 23 of the Contract Act. 15. In the case of K. Viswanathan v. Namakchand Gupta (supra) also, the licence issued under the Rules framed by the Madras Government contained cl. 15. In the case of K. Viswanathan v. Namakchand Gupta (supra) also, the licence issued under the Rules framed by the Madras Government contained cl. 7 which reads as under: "The licencee shall not, without the permission of the licensing authority, assign, sublet or otherwise transfer the licence or the licenced premises, nor shall the licensee, without the permission as aforesaid allow any other person, during the period of currency of the licence, to exhibit the films in the licenced premises." 16. The partnership agreement in the said case was struck down by the Court on account of the expressed prohibition contained in the licence and quoted above. This case, therefore is also of no help to the defendant-appellants. 17. The result, therefore, is that we find no substance in first appeal No. 1 of 1966 which is liable to be dismissed with costs. 18. The decree in the above suit was executed by the decree holder. The judgment-debtors filed an objection under Section 47, C.P.C. The said objection was partly allowed by the Execution Court and they were given the credit of Rs. 41,300 which they had deposited. The execution was ordered to proceed in respect of the balance amount claimed by the decree-holder. No error in the judgment of the execution court has been pointed out to us. The Execution First Appeal No. 243 of 1972 is also, therefore, liable to be dismissed. 19. The first appeal No. 1 of 1966 and Execution First Appeal No. 243 of 1972 are hereby dismissed with costs.