1 S.5244.99Judg..sxw JPP IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUIT NO. 5244 OF 1999 BPM Industries Limited } (Formerly known as Bharat Pulverizing } Mills Ltd.), a Company registered under } the Provisions of Companies Act, 1956 } having its registered office at ‘Sarjan } Plaza’, 100 Dr. A.B. Road, Worli, } Mumbai – 400 018 and administrative } office at Shriniketan, 5th floor, } 14 Queens Road, Mumbai – 400 002. } ... Plaintiffs. V/s. Samartha Development Corporation, } a partnership firm registered under } the Indian Partnership Act, 1932 } having its office at ‘Suyash’ Gokhale } Road (North), Dadar, } Mumbai – 400 028. } ... Defendants. Mr. Shyam Mehta with Zal Andhyarujina i/b. Yasmin Bhansali & Co. for the Plaintiffs. Mr. V.A. Thorat, Sr. Counsel with Vaibhav Sugdare, Rohan Rajadhyaksha and Vinay Bandiwadekar i/b. Mahimtura and Co. for the Defendants. CORAM : R.Y. GANOO, J. DATED : 22nd NOVEMBER 2010. 2 S.5244.99Judg..sxw ORAL JUDGMENT :- The Plaintiffs instituted this Suit on 27th August 1999 for following reliefs :- (a) That this Hon’ble Court be pleased to declare that the Indenture of Lease dated 6th May 1949 in respect of the suit property, whereof the Plaintiffs are the lessees of the said property, has stood renewed with effect from 1st May 1999 for a period of 50 years as provided in the said Indenture of Lease dated 6th May 1949 and as modified / substituted subsequently by Agreement dated 31st August, 1955 and reiterated in the Deed of Conveyance dated 25th November, 1993; (b) That this Hon’ble Court be pleased to order and decree the Defendants to specifically perform the contract for renewal of the Lease contained in the Indenture of Lease dated 6th May 1949, the Agreement dated 31st August 1955 which have been approved, adopted and binding on the Defendants by virtue of Deed of Conveyance dated 25th November 1993, and execute the necessary renewal and do all other acts and things necessary for that purpose; 3 S.5244.99Judg..sxw (c) That this Hon’ble Court be pleased to declare that the terms and conditions of the Indenture of Lease dated 6th May 1949 and the Agreement dated 31st August 1955 are binding on the Defendants and they are bound to specifically perform the terms of the same including the renewal with effect from 1st May 1999 for a period of 50 years. 2. The Defendants herein filed their written statement and in the written statement the Defendants have raised the point as regards the jurisdiction of this Court. On account of this, it was felt necessary to frame an issue of jurisdiction and accordingly, on 24th September 2010, following issues were framed :- (i) Whether this Court has jurisdiction to try and entertain the present Suit ? (ii) What Order ? My answer to these issues are as under :- Issue No. (i) - In the negative. Issue No. (ii) - As per the final order. 4 S.5244.99Judg..sxw 3. Learned Counsels on both sides indicated to the Court that no oral evidence is required to be furnished and Court can decide the issues on the basis of the record. On account of this, it became necessary for the Court to hear arguments on both sides and the same was done. 4. For deciding the aforesaid issues, few facts are required to be stated. By a lease deed dated 6th May 1949, N.R. Parekh and Others executed a lease for a period of 50 years in favour of Aruna Chemicals Colour and Industrial Products Co. Ltd. with effect from 1st May 1949. Said Company went into liquidation. The liquidator was appointed in respect of the said Aruna Chemicals and its properties including property mentioned in para 3 of plaint i.e. the Suit property. The Liquidator by document dated 19th January 1954 assigned the lease in favour of Shamjibhai for unexpired period. Said Shamjihbhai, by document dated 7th July 1954 assigned the lease in favour of Bharat Pulverizing Mills Ltd. for the unexpired period. On account of change of name, the Suit came to be filed in the name of B.P.M. Industries Ltd. By document dated 31st August 1955, N.R. Parekh & Others i.e. landlords executed an agreement with Bharat Pulverizing Mills 5 S.5244.99Judg..sxw Ltd. and modified the terms of the agreement. On 25th November 1993, executrix of Will of Mrs. N.R. Parekh and other owners executed a sale deed of the Suit property in favour of the Defendants. 5. In the circumstances stated aforesaid, the Plaintiffs were enjoying Suit property as lessee and the Defendants were the lessor. 6. The lease deed dated 6th May 1949 was to come to an end on 30th April 1999 by efflux of time. It has been the contention of the Plaintiffs that on account of the assignment of the lease in favour of the Plaintiffs for the unexpired period as mentioned and on the basis of document dated 31.8.1955 between the Plaintiffs and earlier owners, the Plaintiffs were entitled to renewal of lease for 50 years with effect from 1.5.1999. It is admitted by the Plaintiffs that by notice dated 23rd March 1995, the Defendants lessor called upon the Plaintiffs to vacate the suit property as the Defendants required the property for their use. It is also admitted by the Plaintiffs that the Defendants instituted Suit against the 6 S.5244.99Judg..sxw Plaintiffs under Section 13(1)(k) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred as the Bombay Rent Act) being RAE & R Suit No. 770/1421/1998 for recovery of possession of the Suit property on the ground that the Defendants required the Suit premises by way of bonafide requirement. In the course of arguments, it was informed to the Court by the learned Counsel for the Plaintiffs that the Defendants have instituted proceedings in the Court of Small Causes being Ten. R Suit No.429/452/2001 in accordance with the provisions of the Maharashtra Rent Control Act, 1999 by taking the advantage of provisions of Section 3(1)(b) of the Maharashtra Rent Control Act, 1999 (hereinafter referred to as the Rent Control Act). The Court is informed that both these proceedings filed by the Defendants against the Plaintiffs for recovery of possession are pending. 7. At the outset it is required to be mentioned that as of today, the question whether paid up share capital of the Plaintiffs – Company is more than Rs.1.00 crore is yet not finalized and there is no finding given by any Court to that extent. 7 S.5244.99Judg..sxw 8. Looking to the nature of objection raised as regards the jurisdiction of this Court, it became necessary for this Court to ascertain the precise nature of the reliefs sought in this Suit. 9. Learned Counsel for the Plaintiffs had taken me through the various documents which are referred to above. Learned Counsel for the Plaintiffs had contended that if one considers the plaint as a whole, the Suit is for specific performance of the agreement based on the renewal clause appearing in the lease deed dated 6.5.1949 and agreement dated 31.8.1955 by which the Plaintiffs were entitled to get the lease renewed for a further period of 50 years from the day when the lease was to expired i.e. on 30th April 1999. Learned Counsel appearing on behalf of the Plaintiffs had, therefore, submitted that the Court should appreciate the text of the plaint, the nature of the relief sought and hold that this Court has jurisdiction. 10. Learned Senior Counsel Mr. Thorat appearing on behalf of the Defendants had advanced his submissions in support of the stand taken by the Defendants that this Court has no jurisdiction to try and entertain the present Suit. Learned 8 S.5244.99Judg..sxw Senior Counsel Mr. Thorat appearing on behalf of the Defendants had submitted that the averments in the plaint will decide the jurisdiction of the Court and the Court has to consider the pith and substance of the plaint, consider the nature of the dispute and then answer the question of the jurisdiction. Learned Senior Counsel Mr. Thorat appearing for the Defendants had drawn my attention to the Judgment in the case of Nagin Mansukhlal Dagli V/s. Haribhai Manibhai Patel reported in AIR (1980) Bombay 123 where the learned Division Bench of this Court had indicated that even if in a given case the relationship between parties as it originated for the first time has come to an end, the parties shall still be referred to as standing in those relationship i.e. a lessor, landlord and tenant etc.. Learned Senior Counsel Mr. Thorat had even otherwise submitted that looking to the averments in the plaint, the Plaintiffs are interested in styling them as tenant in respect of the Suit property and the Defendants by treating them as landlord. He had, therefore, submitted that the Plaintiffs can be referred to as tenant and the Defendants as landlord. 9 S.5244.99Judg..sxw 11. Learned Senior Counsel Mr. Thorat appearing on behalf of the Defendants had, thereafter, taken me through the provisions of Section 41 of the Presidency Small Cause Courts Act (for short said Act) and had submitted that the Court of Small Causes shall have jurisdiction to entertain and try a Suit or a proceeding if it is between the landlord and tenant and it relates to recovery of possession of any of the property situated in Greater Bombay. Learned Senior Counsel Mr. Thorat has submitted that on a plain reading of the plaint the Suit should be treated as between landlord and tenant and it relates to recovery of possession in regard to the Suit property. He therefore submitted that Small Causes Court will have jurisdiction to try this Suit and it should have been filed in the Court of Small Causes Court at Bombay. 12. Learned Senior Counsel Mr. Thorat in support of above submission relied upon Judgment in the case of Mansukhlal Dhanraj Jain & Ors. V/s. Eknath Vithal Ogale reported in (1995) 2 Supreme Court Cases 665. Learned Senior Counsel Mr. Thorat had taken me to the entire Judgment and submitted that on a reading of this Judgment as a whole and 10 S.5244.99Judg..sxw applying the same to the facts of this Court and considering the reliefs sought by the Plaintiffs, the Court of Small Causes at Bombay shall have jurisdiction to try this Suit. 13. Learned Senior Counsel Mr. Thorat had submitted that by prayer clause (a) the Plaintiffs are claiming to be tenants of Suit property and they want that the said tenancy should be declared as valid and subsisting for a period of 50 years w.e.f. 1.5.1999 on the basis of lease deed dated 6.4.1949 and deed dated 31.8.1955. According to Mr. Thorat, prayer clauses (b) and (c) are in the nature of consequential reliefs keeping in view prayer clause (a). 14. Learned Senior Counsel Mr. Thorat had pointed out to me following points/facts :- (i) The Defendants had issued notice to the Plaintiffs on 23.3.1995 and had called upon the Plaintiffs to vacate the Suit premises. (ii) The Defendants had instituted Suit under Bombay Rent Act under Section 13(k) for recovery of possession in the Court of Small Causes at Bombay. 11 S.5244.99Judg..sxw (iii) The Defendants had instituted application for recovery of possession in the Court of Small Causes at Bombay under Rent Control Act. Learned Senior Counsel Mr. Thorat pointed out that lease came to an end on 30.4.1999 and this Suit was filed on 27.8.1999 for reliefs as per prayer clauses (a) to (c). Learned Senior Counsel Mr. Thorat submitted that by this Suit the Plaintiffs want that they should be treated as tenant and that they should not be evicted from Suit property. It was submitted by Mr. Thorat that looking to above points, the Suit should be treated as Suit by tenant against landlord for protection of possession of the Plaintiffs as regards the Suit property and as such, the Suit would be relating to recovery of Suit property as per the judgment in the case of Mansukhlal D. Jain. It was submitted that on behalf of the Defendants that based on above points, the Small Causes Court at Bombay shall have jurisdiction to try this Suit. 15. Learned Counsel Mr. Shyam Mehta appearing on behalf of the Plaintiffs had submitted that on a plain reading of the plaint, the Suit is for enforcement of the clause as regards renewal of the lease and therefore, the Suit will have to be 12 S.5244.99Judg..sxw treated as a Suit for specific performance of the lease deed dated 6th May 1949 coupled with the renewal clause reflected in agreement dated 31st August 1955 by which it was agreed that the lease shall be renewed for a period of 50 years. He had, therefore, submitted that it is the Civil Court shall have jurisdiction to try and entertain the present Suit. In reply to the arguments advanced by the learned Counsel for the Defendants that the Court of Small Causes shall have jurisdiction, learned Counsel Mr. Mehta appearing on behalf of the Plaintiffs had submitted that Section 18 and Section 19 of the Presidency Small Cause Courts Act create a bar as regards entertaining Suit for specific performance of the agreement. He had submitted that on account of said provisions, small Causes Court will not have jurisdiction. 16. Learned Counsel Mr. Mehta appearing on behalf of the Plaintiffs had submitted that this Suit does not relate to recovery of possession and as such, Small Cause Court will not have jurisdiction to try this Suit even if the first requirement namely relationship between parties as tenant and landlord is fulfilled. He tried to bring about a distinction 13 S.5244.99Judg..sxw between a term viz. “Suit relating to recovery of possession” and “a Suit relating to possession”. Learned Counsel Mr. Mehta appearing on behalf of the Plaintiffs had relied upon the Judgment in the case of Navyug Co-op. Housing Society Ltd. & Anr. V/s. Vile Parle Kelavani Mandal & Anr. Reported in 2005(3) Bom.C.R. 579 and had submitted that the present Suit filed by the Plaintiffs at the best can be treated as a Suit relating to possession and as such, theSuit should be exclusively decided by the Civil Court. Learned Counsel Mr. Mehta submitted that the Small Causes Court shall have jurisdiction to try and entertain the Suit if the requirement under Section 41 of the Presidency Small Causes Court Act are fulfilled. He submitted that in the present case the two requirements are not fulfilled. Learned Counsel Mr. Shyam Mehta had submitted that the present Suit does not fall within the ambit of Section 41 of said Act and this Court will have jurisdiction to decide the Suit. 17. Learned Senior Counsel Mr. Thorat appearing on behalf of the Defendants had placed reliance on the Judgment in the case of ING Vysya Bank Limited V/s. Modern India Limited & Anr. reported in 2008(2) Bom. C.R. 255. Mr. 14 S.5244.99Judg..sxw Thorat had taken me through the said Judgment and submitted that if the Suit instituted by the Plaintiffs falls within the terminology namely Suits relating to recovery of possession, then the embargo created by Section 18 and Section 19 of the Presidency Small Cause Courts Act should not be attracted and that the Small Causes Court can entertain the Suit even if the Suit is for specific performance of contract. He had drawn my attention to the facts appearing in the case of ING Vysya Bank Ltd. and has submitted that in the said case the Court came to be conclusion that the proceedings initiated by the Petitioners were in the nature of the Suit relating to recovery of the possession and therefore, the Small Causes Court did have the jurisdiction. 18. Learned Senior Counsel Mr. Thorat appearing on behalf of the Defendants had relied upon the Judgment in the case of Tejbai Tejshi Dedhia & Ors. V/s. Central Bank of India reported in 2007(6) Bom. C.R. 60 to contend that a Suit for specific performance of agreement for construction of a building on the old premises was held to be a Suit which can be entertained by the Court of Small Causes. According to 15 S.5244.99Judg..sxw him, the observations made in the said Judgment would help the Defendants by which the Defendants are contending that the Small Causes Court at Bombay shall have jurisdiction to try and entertain the present Suit. Learned Senior Counsel Mr. Thorat had, therefore, reiterated his submission as regards the nature of the Suit and that Court of Small Causes shall have jurisdiction to try and entertain the present Suit. 19. I have considered the rival submissions and the Judgments relied upon by the respective parties. In order to resolve the controversy raised in the present Suit as regards jurisdiction, it is necessary first to ascertain the nature of the Suit filed by the Plaintiffs. The Plaintiffs have claimed in the plaint that on account of lease deed dated 6th May 1949 and on account of agreement dated 31st August 1955 executed by the earlier landlord in favour of the Plaintiffs, the lease deed which was valid for 50 years was agreed to be renewed and the Plaintiffs are claiming that the lease stood renewed. The Plaintiffs have referred to the various documents which came to be entered into from time to time and a close perusal of the plaint would go to show that it is the stand of the Plaintiffs that the lease which expired on 30.4.1999 stood renewed in 16 S.5244.99Judg..sxw favour of the Plaintiffs. I therefore hold that the Plaintiffs are seeking a declaration that they are the tenant/lessee in respect of the Suit property for a period of 50 years from the time when the lease ought to have been renewed i.e. from 1st May 1999. This observation is based on prayer clause (a) of plaint. So far as the terms and conditions as to how they would enjoy tenancy, they are referring to the lease dated 6th May 1949 and the document dated 31st August 1995 and the deed of conveyance dated 25th November 1993. The Plaintiffs want that the terms and conditions mentioned in those documents be considered and status of the Plaintiffs as a tenant be confirmed in regard to Suit property. That is to say the present Suit is a declaratory Suit between the landlord and a tenant. 20. It is true that by prayer clause (b) the Plaintiffs have sought specific performance of contract of renewal of lease contending lease dated 6th May 1949 coupled with agreement dated 31st August 1955 and deed of conveyance dated 25th November 1993. A true reading of this prayer would clearly go to show that the Plaintiffs want that the Defendants should execute a lease deed in favour of the Plaintiffs for a further 17 S.5244.99Judg..sxw period of 50 years in terms of the three documents referred to once relief of declaration as tenant is granted. If relief in terms of prayer clause (a) is granted to the Plaintiffs, then, execution of a document in favour of the Plaintiffs by the Defendants is a matter of formality and therefore, the relief in terms of prayer clause (b) will have to be treated as a consequential relief. The Plaintiffs have by prayer clause (c) want to enforce the lease deed dated 6th May 1949 and agreement dated 31st August 1955 and want that the Defendants should acknowledge the Plaintiffs as their tenant. Taking these three prayers together, the whole plaint can be termed as a Suit for a declaration that the Plaintiffs are tenant in respect of the Suit property on terms and conditions set out in lease deed dated 6th May 1949 coupled with agreement dated 31st August 1955 and document dated 25th November 1993. In my view, the argument advanced by the learned Counsel for the Plaintiffs that the present Suit is for specific performance of the three agreements cannot be accepted. The present Suit for reasons mentioned aforesaid is a Suit for declaration that the Plaintiffs are tenant in respect of the Suit property. 18 S.5244.99Judg..sxw 21. Having observed that the Suit is not for the specific performance of an agreement, there is no question of Section 18 and Section 19 of the Presidency Small Cause Courts Act getting attracted to the facts of this case. 22. Before I proceed to deal with the question whether the Suit is relating to recovery of possession, few facts appearing on the basis of record are required to be stated. Original lease came to an end on 30th April 1999. It is true that the Plaintiffs had by notice dated 8.2.1999 had called upon the Defendants to renew the lease in terms of the various documents executed by and between the parties as mentioned aforesaid. The plaint also narrates that by letter dated 23rd March 1995, the Defendants had called upon the Plaintiffs to vacate the suit premises. This will mean that way back in 1995 itself i.e. four years prior to expiry of the lease, the Defendants had indicated that they do not want the Plaintiffs to remain in the Suit property and they should vacate the Suit property. It is pertinent to note that the Defendants had in their capacity as landlord instituted Suit No.RAE & R No.770/1421/1998 against the Plaintiffs for recovery of possession under Section 13(1)(K) of the Bombay Rent Act on the ground that the Defendants 19 S.5244.99Judg..sxw bonafide required the Suit premises. Looking to the conduct of the Defendants, the Plaintiffs realized that the Defendants are intending to remove the Plaintiffs from the Suit property. The Plaintiffs did not take any step till 30th April 1999 for institution of the Suit i.e. during the time when the lease was subsisting. It is only after the lease came to an end, the Plaintiffs instituted this Suit for a declaration and for the other reliefs as mentioned in the earlier para of this Judgment. Across the bar it was argued by the learned Senior Counsel for the Defendants that the paid up share capital of the Plaintiffs is more than Rs.1.00 crore and the Plaintiffs had no right to continue in the premises as their protection under the provisions of Rent Control Act came to an end which protection was earlier enjoyed by them in their capacity as a tenant as per the provisions of Bombay Rent Act. It is true that the proceedings for recovery of possession came to be filed in 2001 by taking the benefit of provisions of Section 3(1) (b) of the Rent Control Act. There is no reference to it in the plaint as the said proceedings were filed after the filing of this Suit. The Plaintiffs did not take any steps to amend the plaint and mention factual aspect as regards institution of 20 S.5244.99Judg..sxw proceedings for recovery of possession which came to be filed in the year 2001 under the Rent Control Act. 23. A plain reading of the various facts which I have disclosed above coupled with the fact that the Suit has been instituted to seek a declaration that the Plaintiffs are tenant in respect of the Suit property of the Defendants, it is clear that the Plaintiffs wish to protect their possession in regard to the Suit property. If the relief which is sought by the Plaintiffs in terms of prayer clause (a) is granted, the Plaintiffs would be able to style themselves as tenant in respect of the Suit property and would be able to draw benefit arising out of the said situation. For these reasons, I am inclined to observe that the present Suit will have to be treated as a Suit to protect possession of the Suit property. 24. After having recorded findings that the present Suit is filed to protect possession in regard to the Suit property by the Plaintiffs, the question is whether the Civil Court will have jurisdiction to try and entertain the present Suit or it is the Court