:1: IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION SUIT SUIT SUIT NO. 3224 OF NO. 3224 OF NO. 3224 OF 1984 1984 1984 Kasturi Shetty & Ors. ... Plaintiffs. V/s. A.S. Bhandary. ... Defendant. Mrs. S.Singh for the Plaintiffs. Mr. M.J. Jamdar for the Defendant. ..... CORAM CORAM CORAM : S.C. DHARMADHIKARI,J. : S.C. DHARMADHIKARI,J. : S.C. DHARMADHIKARI,J. 27TH 27TH 27TH JANUARY 2009. JANUARY 2009. JANUARY 2009. P.C. P.C. P.C. : : : . In pursuance of my order dated 19th January 2009, I heard parties on the issue of jurisdiction which has been framed as a preliminary issue. As has been indicated in the said order, parties proceeded on the basis that Section 41(1) of the Presidency Small Causes Court Act, 1882 (for short, PSCC Act) is attracted or not. All arguments proceeded on the basis of applicability of the law laid down by a Full Bench of this Court in Prabhudas Damodar Kotecha V/s. Manharbala Jeram Damodar reported in (2007)(4) All Maharashtra Reporter page 651. 2. The matter was placed today. Both sides informed me that they do not wish to lead any oral evidence. Mrs. Singh, learned Advocate appearing for the Plaintiffs states that the Court may decide this issue on the basis :2: of the averments in the plaint and assuming that the allegations therein are true. Mr. Jamdar, appearing for the Defendants states that the plaint allegations and contents of Annexure "B" may be looked into and the issue framed on 19th January 2009 be answered accordingly. 3. Mrs. Singh has taken me through the plaint and the annexures to the same. She would urge that what the Plaintiffs have given to the Defendant was the authority to manage and conduct the running business of a Hair Cutting Saloon. The premises were not handed over. There was no licence created in favour of the Defendant in respect of the immovable property/premises. In such circumstances, and when the Suit is filed with a prayer to direct the Defendant to hand over the running business, then, by no stretch of imagination this arrangement can be construed as a leave and licence or licence within the meaning of Section 52 of the Easement Act so as to attract Section 41 of the Presidency Small Causes Courts Act, 1882. 4. On the other hand, Mr. Jamdar contends that if the agreement which is annexed to the plaint is read as it is and as a whole, then, a conclusion is inevitable that the Suit is essentially filed to recover possession of the immovable property. It is not just a Suit for declaration of the right of the Plaintiff but is coupled with specific reliefs relating to handing over possession of the :3: immovable property. Ultimately, the business is being conducted in the Suit premises. The Suit premises are immovable property. There is a permission to enter upon the Suit property/permises for conducting the business. Therefore, it is not as if the possession of the immovable property is not handed over. Once it is handed over for conducting the running business, may be for a limited period of time, then, the Suit clearly falls under Sub-Section 1 of Section 41 and therefore, this Court has no jurisdiction to entertain and try this Suit. This Suit must, therefore, be dismissed. 5. For properly appreciating these contentions, the plaint will have to be seen and read as a whole. In para 1 of the plaint it is stated that the original Plaintiff is a lawful tenant in respect of the suit premises/shop premises. It is stated that the suit premises were acquired by the original Plaintiff for conducting Hair Cutting Saloon business. In para 2 of the plaint, it is stated that the Defendant was a conductor in respect of the business since 6th May 1965 onwards till the time the conducting agreement/arrangement was terminated. 6. In paragraphs 3,4 and 5 of the plaint, this is what is stated :- "3. The Original Plaintiff says that by virtue of an Agreement for Conducting dated 6th May 1965, :4: entered into and executed at Bombay by and between the original Plaintiff and the Defendant, the Plaintiff appointed the Defendant to run the said business of New Best Hair Cutting Saloon as original Plaintiff’s conductor on the terms and conditions as more particularly set out in the said writing dated 6th May 1965. Under the said writing, the Defendant agreed to pay the original Plaintiff sum of Rs.375/- per month as royalty charges exclusive of rent of the said premises, payable by the Defendant, electricity charges, wages and compensation due to the servants employed at the said Hair Cutting Saloon and also other bills as more particularly set out in the said writing. The Plaintiff says that the Defendant was to run, conduct and manage the said Hair Cutting Saloon - business of the original Plaintiff on the terms and conditions set out in the said Agreement. At the time of the execution of the said Agreement, the Defendant deposited a sum of Rs.7,000/- as and by way of Security Deposit for ensuring due performance of the terms and conditions of the said Contract, which was liable to be forfeited in view of the breach of the said terms and conditions of the Contract and was not to bear any interest. The legal possession of the said premises as also the said business always continued with the Plaintiff alone. Hereto annexed and marked Exhibit ‘A’ is a :5: copy of the said Agreement for Conducting dated 6th May 1965. The Plaintiff says that it appears that by bonafide mistake and/or inadvertence of both the parties, the list of articles was not attached to the said Agreement though as a matter of fact, the said business was given to the Defendant for conducting alone with all the furnitures, articles and fixtures required for Hair Cutting Saloon Business. The original Plaintiff says that prior to the original Plaintiff giving the said business of conducting to the Defendant, the said business was given on conducting basis to one Shri Gopalkrishna Salian. Hereto annexed and marked Exhibit ‘A1’ is the list of furniture and fixtures given to the Defendant at the time of the said Agreement. 4. The Plaintiff says that upon expiry of the term of the said Agreement for Conducting dated 6th May 1965, subsequently, as and by way of renewals, the Agreement for Conducting were entered into on 20th July 1967, 27th June 1969 and the last of the such Conducting Agreement and writing was executed on 31st May 1972. The original Plaintiff says that the said amount of monthly royalty charges payable by the Defendant to the original Plaintiff which was originally fixed at Rs.375/- were raised to Rs.500/- exclusive of other payments to be made by :6: the Defendant as per the terms of the said Agreement. Hereto annexed and marked Exhibit ‘B’ is a copy of the last Agreement dated 31st May 1972. The Original Plaintiff says that the Shops and Establishment Licence in respect of the said business of Hair Cutting Saloon stands in the name of the Plaintiff. Under the terms of Contract, all other outgoings as stipulated therein were payable by the Defendant. The original Plaintiff craves leave to refer to any rely upon the said Shops and Establishment Licence and other documents so as to show the legal possession of the Plaintiff in respect of the said business. The Original Plaintiff also craves leave to refer to and rely upon the Conducting Agreements dated 20th July 1967 and 27th June 1969 when produced. (5) The Original Plaintiff says that in or about the beginning of 1969, the original Plaintiff desired and called upon the Defendant to hand over the possession of the said business of New Best Hair Cutting Saloon to the original Plaintiff as the original Plaintiff himself wanted to continue his business at the said shop premises. The original Plaintiff says that thereupon, the Defendant without any justification rushed to the Court of Small Causes at Bombay and filed a Declaratory Suit being Suit No.1823 of 1980 against :7: the original Plaintiff and two others i.e.the landlord and the said Shri Ahir. The said Suit was filed by the Defendant in the month of March 1980. The Plaintiff says that the Defendant had paid monthly royalty charges at the rate of Rs.500/- per month right upto the month of filing of the said suit. The original Plaintiff says that in the said Suit, falsely filed by the Defendant, inter alia, against the original Plaintiff, the Defendant falsely contended that the said premises were given to the Defendant on Leave and License basis since March 1965,and that he was in exclusive possession use and occupation of the same ever since then and that by virtue of coming into operation of the said Maharashtra Act, XVII of 1973, he had become a protected Licensee/deemed tenant in respect of the suit premises and was protected by the provisions of Bombay Rent Act as amended. The original Plaintiff says that it was also falsely alleged by the Defendant in the said Suit, that by the said Agreement the Hair Cutting Saloon was agreed to be given on Leave and Licence basis and the said Agreement for Conducting was not to be acted upon and as a matter of fact, the said Agreement was an Agreement for Leave and License. The Plaintiff says that it is false case and contention of the Defendant that subsequent Agreements were also executed on the basis of same representation as was :8: made in 1965 while entering into the said first Agreement. The Defendant has wrongly contended in the said suit that apart from the said two Agreements dated 6th May, 1965 and 31st May 1972, no other Agreements were entered into though, in fact, the Defendant himself has signed other Agreements as stated hereinabove. The original Plaintiff craves leave to refer to an rely upon the said Agreements when produced. The original Plaintiff says that the said suit which has been filed by the Defendant in the Court of Small Causes at Bombay being Declaratory Suit No.1823 of 1980 is without jurisdiction, misconceived and not maintainable in the said Court. The Defendant is not entitled to protection of Bombay Rent Act as sought to be contended by him in the said suit and Bombay Rent Act has no application whatsoever inasmuch as the relationship between the Plaintiff and the Defendant was and is not that of landlord and the tenant or Licensor and the Licensee." 6. Thereafter, in para 7, the Plaintiff states thus :- "7. The Original Plaintiff says that the said last agreement of Conducting dated 31st My, 1972 was for a period of 11 months commencing from 1st June, 1972 to 30th April, 1983. The said agreement dated 31st May, 1972 stood terminated by efflux of :9: time on 30th April, 1973. Thereafter, permissive use granted to the Defendant by the Plaintiff by virtue of and under the said agreement of Conducting came to an end the Defendant became a trespasser in respect of the said premises and the said business carried thereat. The original Plaintiff says that by Clause 10 of the said Agreement dated 31st May, 1972, it was specifically agreed by and between the original Plaintiff and the Defendant and as recorded in Clause 10 of the said agreement that no interest was intended to be created in favour of the conductor i.e. the Defendant in respect of the said saloon or its premises and the Defendant expressly undertook not to claim any such right or interest and not to put up any plea of tenancy of sub-tenancy and not to put up any plea of tenancy of sub-tenancy etc. in respect of the said business and the said premises and agreed to execute such writings as may be necessary and desired by the original Plaintiff. The Plaintiff says that accordingly, it was never intended and in fact, no interest was created in favour of the Defendant in respect of either the said business or the said Shop premises or any part thereof. The Defendant was given the said business on conducting basis and apart from permissive use granted by the original Plaintiff to the Defendant as conductor of the said running business, the :10: Defendant had no right, title, interest or claim of any nature whatsoever either in respect of the said business or the said shop premises or the articles entrusted to the Defendant by the Plaintiff under the Original Agreement dated 6th May 1965, renewed from time to time and ultimately by the said last agreement dated 31st May, 1972. The Original Plaintiff says that the said subsequent amounts after the expiry of the said period on 30th April, 1973, under the said agreement dated 31st May, 1973 were accepted without prejudice to the right and contentions of the Plaintiff in the matter and without prejudice thereto in any event the original Plaintiff says and submits that the Plaintiff never accepted the said payment with intention to renew the said conducting agreement. The Plaintiff says and submits that the acceptance of the said subsequent payments after 30th April, 1973, does not amount to the creation of any tenancy or licence in favour of the Defendant as falsely sought to be suggested by the Defendant in the said Suit filed in the Court of Small Causes and even otherwise. The whole story as set up in the said Small Causes Court suit of the Defendant being Licensee protected by the said amended Act, is totally false and frivolous and after-thought. The original Plaintiff says that the said agreement of conducting as stated hereinabove has already :11: expired on 30th April, 1973 and thereafter, the Defendant has been conducting the said business and remained on the said premises only as and by way of trespasser and upon request for allowing him to continue the same till he gets possession of other premises. The original Plaintiff has rightly called upon the Defendant to handover the possession of the said business alongwith the said premises and the articles, but the Defendant has failed and neglected to handover the possession of the said business and the premises and the said articles to the original Plaintiff. The original Plaintiff says that the Defendant is in wrongful possession, use and enjoyment of the said business and the said shop premises. Without prejudice to what is stated hereinabove, in any event upon filing of the said suit by the Defendant against inter alia the Plaintiff, the said agreement of conducting, assuming without admitting that by the implication of same stood extended till February, 1980, stood terminated and the Defendant became bound and liable to handover the possession of the said business, the premises and the articles entrusted to him. The original Plaintiff says and submits that the Defendant is in unlawful use, occupation of the said business and is liable to handover the possession thereof to the original Plaintiff by removing himself and his articles :12: therefrom. The Defendant has not paid the damages/compensation with effect from April 1980 till today amounting to Rs.22,500/- calculated at the rate of Rs.500/- per month. The Plaintiff however claims the arrears of Rs.18,000/- at the rate of Rs.500/- per month and gives up its claim for compensation and/or damages for the period prior to 1st December 1981, as the same is barred by the law of limitation. Hereto annexed and marked Exhibit ‘E’ are the particulars of the claim of the Plaintiff. The Plaintiff says that the Defendant is bound and liable to pay interest on the said amount of damages at the rate of 18 per cent per annum or any such other rate as this Hon’ble Court may deem fit and proper in the nature and circumstances of the case from 1st December 1981." 7. It is, in this background and contending that the agreement of conducting is specifically exempted by virtue of Section 5(4A) read with other provisions of the Bombay Rent Act, that this Court has jurisdiction to entertain and try the Suit. In other words, such agreements and persons inducted as conductors are exempted from the definition of term "licensee" and hence, the Small Causes Court has no jurisdiction to entertain and try this Suit which was filed by the Defendant. It is for this reason that the Plaintiff asserts that his Suit can be tried by :13: this Court. 8. Prayer clause (a) is for a declaration with regard to the business. Prayer clause (b) is with regard to handing over possession of the business. Prayer clauses (c) and (d) read thus :- (c) That the Defendant by himself, his servants and agents be ordered and decreed by a mandatory order and injunction of this Hon’ble Court to remove themselves, from the said shop premises along with their belongings, if any, hand over the possession thereof to the Plaintiff; (d) That the Defendant by themselves, their servants and agents be permanently restrained by an order and injunction of this Hon’ble Court from entering into or remaining upon the said shop premises, i.e Shop No.2, Ground Floor, Sonwadi Mansion, Lady Jamshedji Road, Mahim, Bombay - 400 016 or part thereof." 9. It is, in this background and for a limited purpose that I have perused annexure ‘A’ to the plaint which is an Agreement date 6th May 1965, Clause 1 itself would make it clear that the original Plaintiff agreed with the Defendant to grant leave and licence to run and manage the New Best Hair Cutting Saloon Business conducted by the :14: owner/plaintiff with the use and benefit of the goodwill of the said business, the fixtures and things attached therein for a period of 11 months on the basis of leave and licence or hire. Clauses 2 and 3 set out the arrangement as to how the business has to be conducted and the consideration thereof. Clauses 4 and 5 deal with a case of the Defendant not being allowed to trade in another name and not to carry out any repairs or renovations to the premises. Clause 6 talks of a deposit whereas clause 7 provides for termination. Clause 8 talks of termination in default and clearly speaks of a leave and licence. Clauses 9 and 10 read thus :- (9) The Hirer being a mere license of the Owner permitted by the owner to run and to manage the said New Best Hair Cutting Saloon business of the Owner on terms of leave and license contained herein and as such the Hirer expressly undertakes not to claim any interest whatsoever in the said Saloon and or its premises and in case the Hirer in law be entitled to any such interest either in the said Saloon or its premises the Hirer at the cost and request of the Owner undertakes to execute such writing, deed or matter to fully assume unto the Owner all his interest in the said New Best Hair Cutting Saloon and its premises. (10) The Hirer further admits that the Owner :15: under a leave and license agreement being in legal possession of the said New Best Hair Cutting Saloon the Owner is at perfect liberty to enter and to inspect the said Saloon and its premises without any objection whatsoever from Hirer and upon due determination of this agreement to conduct by efflux of time or otherwise as provided herein, the Hirer undertakes to put the owner back in charge of his said New Best Hair Cutting Saloon without any delay or default thereof." 10. From a perusal of the above and when it is not seriously disputed before me that the Suit relates to recovery of possession of a immovable property instituted in Greater Bombay, then, it is not possible to accept the contentions of Mrs. Singh that this Court has jurisdiction to entertain and try the Suit. In my view, the plaint averments and the agreement between parties in writing would point out that all ingredients of Section 41(1) of the Presidency Small Causes Court, Act, 1882 are complied with. 11. The Full Bench decision refers with approval to the observations of a Division Bench of this Court which were subsequently upheld by the Supreme Court while construing and interpreting the words appearing in Section 41(1). The controversy before the Full Bench of this Court was whether a gratuitous licensee is covered by Section 41(1) :16: of the above Act. The argument was that another Division Bench of this Court has taken a view that a licensee for consideration alone is covered by the said provision. Over ruling that view of the Division Bench, the Full Bench held that all types of licensees are covered by the words and expressions in Section 41(1). The Full Bench held that there cannot be any distinction between the ordinary concept of a licence and licensee under Easement Act and the term as defined in the Rent Control legislation. For interpreting the words and expressions used in Section 41(1), such distinction cannot be made. These are the clear observations which have been made in paragraphs 34 to 36 of the Full Bench Decision. The Full Bench also dealt with the argument about applicability of Section 28 of the Rent Act and after referring to the said provision in paragraphs 39 and 41 observed thus :- "39. A mere look at Section 28 of the Bombay Rent Act and Section 41(1) of PSCC Act would clearly show that pari materia words are used about nature of suits in both these provisions for conferring exclusive jurisdiction on Small Cause Court, namely, it alone can entertain the suits or proceedings relating to recovery of possession of the premises. Section 41 of PSCC Act deals with such suits between the licensee and licensor also, while Section 28 of the Bombay Rent Act, 1947 deals with the suit only between the landlord and tenant :17: and between licensor and licensee relating only to the recovery of the licence fee or charge. Where the premises are governed by the provisions of the Rent Act, the provisions of Section 28 would be attracted and where the premises are not governed by the Rent Act, the provisions of Section 41 of PSCC Act would apply. But the nature of such suits as envisaged by both these sections is same. 41. The Division Bench in Ramesh Dwarkadas Mehra’s case in paragraph 38 has observed that "the Rent Act and the Chapter VII of PSCC Act are pari materia, is incontrovertible in view of the specific provision made in Section 51 of the Rent Act". We are unable to agree with this observation. A glance at Section 51 of the Rent Act would show that it provides for the removal of doubt as regards proceedings under Chapter VII of PSCC Act. It states that for removal of doubt, it is declared that, unless there is anything repugnant in the subject or context references to suits or proceedings in this Act, shall include references to proceedings under Chapter VII of PSCC Act and references to decrees in this Act shall include references to final orders in such proceedings. The division Bench in Ramesh Dwarkadas Mehra’s case finds support from this provision in coming to the conclusion that it :18: should be guided by the provisions of the Rent Act while interpreting the word "licensee" in Chapter VII of PSCC Act. In our opinion, Section 51 of the Rent Act will have to be read with Section 50. On the date when the Rent Act came into force, there were two different kinds of proceedings for recovery of possession pending in two different courts in the city of Mumbai. There were proceedings under Chapter VII pending in