TMI Blog1986 (10) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... ent were that - the lessee should construct a cinema theatre on the open site at the cost of Rs. 50.000/-, the rent should be Rs. 6.000/- per annum, out of which Rs. 1,200/- should be paid to the plaintiff and the balance should go towards the payment of the cost of the construction of the theatre. The period of lease was 25 years and at the termination of the lease, the lessees would remove the machinery, setting, equipments and other furniture from the theatre within six months of the termination of the lease and hand over vacant possession of the building to the lessor. If for any reason beyond the control of the lessees the building could not be used for the purposes of the cinema talkies, the lessees would use the premises for such period over and above the period of lease; and the lessees would not remove the wiring of the cinema-hall at the termination of the lease but would remove the cabin wiring with the other specified fittings. Accordingly, a cinema theatre was constructed on this site and in respect of the amount Rs. 50,(XX) spent, Rs. 4,800/- per annum were adjusted in the rent. After the expiry of the lease on 3rd October, 1971, the plaintiff sent a notice on 26th No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llments and this finding operates as res judicata in the present suit. 4. The 5th defendant, who had filed a separate written statement, urged that he was in possession of the cinema building on behalf of a partnership firm constituted for running the business and the plaintiff had accepted rent from that firm of which he (defendant No. 5) was the managing partner. He also contended that without (he permission of the Rent Controller, the claim for possession could not be maintained. 5. The learned trial Judge negatived the objection raised by the defendants with regard to the Court-fee and the partnership which was alleged by the 5th-defendant. He held that since the lease was of an open site, it would not be governed by the provisions of the Rent Control Order and the plaintiff could claim possession without obtaining the permission of the Rent Controller. He found that the plaintiff was entitled to damages at Rs. 2,498/- per month from 7-9-1972 to 30-11-1972 amounting to Rs. 6,928./- and passed a decree as stated above. 6. In this appeal, only tow points were raised by Shri V. R. Manohar, the learned Counsel for the appellants, viz., that upon a construction of the terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to lease out an open site for the construction of a cinema building and whatever structures existed upon the site at the time of the lease were to be demolished and were demolished. This position also is not in dispute. In addition to the terms regarding the description of the property, the rent to be paid and the manner in which the cost of construction should be adjusted towards the rent to which I have already referred, significantly clause No. 6 provided that the lessees shall continue to be the undisputed proprietors of the theatre during the period of the lease, being only bound to respect the terms of the lease. Shri Manohar for the appellant, however, referred to the building being insured for the sum of Rs. 50,000/- (clause 7), that the Municipal (axes should be paid by the lessees and the right of re-entry provided to the plaintiff upon default in payment of the Municipal taxes, for urging that though initially the expenditure was borne by the lessee, the building became the property of the plaintiff and the lease, in effect, was of the building after its completion. These are general clauses which are found to be in any agreement of lease and not much significance can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. 10. Reference was also made on behalf of the appellants to clauses i\H)J 20) and (24) where the words, transfer of control and possession of the buildings have been used without referring to the transfer of ownership of the buildings. Clause (18) has reference to the undertaking of the lessor to take steps for causing the tenants and occupants of the buildings to vacate immediately and hand over the control and possession thereof the lessees. This is consistent with the lease of the open site alone and, admittedly, the structures were demolished in pursuance of this clause before the construction of the cinema building. Clause (20) has reference to the rent of the land and the premises being charged from the date of handing over control and possession of the land, buildings described in the Schedule by causing the tenant and occupants to vacate. This again has no reference to the building constructed by the lessees. Clause (24) is as follows : - That after the termination of the lease, the lessees shall be en titled to remove (i) the talkies equipment and machinery and (ii) the sitting equipments and other furniture of the theatre and transfer the control and posses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments, there can be no doubt about the fact that the money for the construction came from the plaintiff and that he was the owner of the structure. It was urged that the finding about the advance of the loan operates as res judicata. The trial Court on (he text of section 11 of the Code of Civil Procedure took the view that as the Court of the Civil Judge (Junior Division), which decided the suit, had no competence to entertain the subsequent suit which was cognisable by the Civil Judge (Senior Division) and as latter suit could not have been decided by the Court which decided the earlier suit, the finding on that issue would not operate as resjudicata. Shri Manohar, the learned counsel for the appellants, however, urged that the decision on the issue would operate as res judicata, in view of Explanation VIII to section 11 of the Code of Civil Procedure, which is as follows:- Expiation VII: An issue heard and finally decided by a Court of limited jurisdiction, competent to decide such issue, shall operate as res judicata in a subsequent suit, notwithstanding that such Court of limited jurisdiction was not competent to try such subsequent suit or the suit in which such issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould only apply where the two proceedings are suits. 13. From the statement of Objects and Reasons for the Bill which was subsequently enacted as Amending Act 104 of 1976 and by which the amendment was brought about- it is clear that the intention underlying the introduction of Explanation VIII was that the decisions of the Courts of limited jurisdiction should operate as res judicata in a subsequent suit although the Court of limited jurisdiction may not be competent to try such subsequent suit. Shri Bobde urged that Explanation VIII should not be so read as would wipe out the effect of the main section. But it is difficult to agree with him on this point, because unless something in Explanation VIII itself requires a restricted meaning to be given to the expression a Court of limited jurisdiction , the words employed therein will have to be given their ordinary meaning and there is no warrant for reading such a restriction in Explanation VIII. According to Shri Bobde, the categories to which the text of section 11 will apply and Explanation VIII would apply are different, because the text of section 11 deals also with suits and requires for its operation that the Court dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eettil Nolliyodan Kunhi Raman Nair AIR 1980 Ker 230; Hari Singh vs. Smt. Sringar Kanwar Rajasthan Law Weekly 1081, page 190; and Kumarmoni Sa vs. Himachal Sahu AIR 1981 Ori 177. 17. The Division Bench of the Kerala High Court has pointed out that the correct mode of interpretation is to read the section in combination and harmony with Explanation VIII. and the object and purpose underlying the introduction of Explanation VIII was much wider, namely, to render the principle of res judicata fully effective so that issues heard and finally decided between the parties to an action by any Court competent to decide such issues should not be allowed to be reagitated by such parties or persons claiming through them in a subsequent litigation. In the Rajasthan case, the learned Judges took the view that the expression a Court of limited jurisdiction is wide enough to include a Court whose jurisdiction is subject to a limited pecuniary jurisdiction and it will not be right to interpret the said expression as connoting only a Court other than Civil Courts. The Division Bench of Orissa High Court, while expressing its agreement with the view taken by the Kerala High Court, added that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Court was also right in its view that the plaintiff was entitled to a decree for possession. 20. With regard to the amount fixed as mesne profits, Shri Manohar urged that there was no evidence to justify the finding that the mesne profits would be Rs. 2,498/- per month, no rebate was given for the income-tax that would have become payable, and in any event, the mesne profits should have been fixed on the basis of the rent being Rs. 500/- for the open plot and whatever might be the rental of the empty hall, and not on the basis that the premises were used for running a cinema hall. 21. On the basis of the returns of the collections for entertainment tax submitted by the appellants to the Collector, the gross receipts by way of sale of tickets in September, 1972 were Rs. 34,588.60, and for October, 1972, they were Rs. 31,190.60. By reducing the amount of tax and surcharge paid for the months of September, October and November, 1972, the amount would be between Rs. 16,778.20 and 18,560.97. Ambadas, who was the Manager of the Kailash Talkies, stated that the expenses on account of electricity were Rs. 600/- to Rs. 700/- per month; Rs. 4000/- per month were spent on the accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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