Case: Dwarka Prasad Vs. Dwarka Das Saraf

from the land and building, to the machinery and equipments etc., and whether there was any provision in the deed relating to them, he confessed that there was no specific provision in the deed. Obviously they cannot be governed by Madras Act XV of 1946 and so he said they must be governed by the general law of contract. He also conceded that if the lessees paid Rupees 1600/- but defaulted in the payment of the balance which is due as hire, the lessors have no right to ask for eviction under the Rent Control Act. We think that the attempted division of the lease and separation of rights in regard to two classes of property is in the highest degree artificial, never contemplated by the parties. Here is a lease of a talkie house with everything that is necessary to run cinema shows. To split up such a composite lease as this into separate contracts of lease and hire is to destroy it altogether. Mr. Ramachandra Iyer argued that the furniture which was covered by the lease fell within the definition of Section 2 of the Act. We do not agree. The observations of the learned Judges in App. No. 590 of 1945 (Patanjali Sastri and Bell JJ.) in dealing with the plant, machinery and other moveables which were demised along with a factory are very apposite in this connection: No doubt in one sense the buildings comprised in the lease deed contain articles supplied by the landlord; but we cannot agree that what was so supplied can be considered in any modern sense as being furniture.Though in that case the learned Judges were dealing with the lease of a factory called the West Coast Match Co., which consisted of land and buildings including a bungalow used for residential purposes together with plant, machinery and moveables contained therein, we think the principle of that decision would apply equally to the case before us in which there is a lease not merely of a building but of a cinema theatre with all necessary equipment for the exhibition of films."23. It is true that in Jaffer Alis case AIR 1971 Andh. Pra 156 (FB) and in Govindans case AIR 1966 Ker 244 (FB) (the Andhra and Kerala decisions referred to above) cinema theatres have been held to fall within the definition of building, under the relevant rent control law of those States. A bare reading of the two cases would show that certain amendments had been made to the parent statutes whereby the definition was expanded and its wide range was made to include all tenancies relating to all structures, even though accessories, furniture and fittings for use in the house were also made over. There is no doubt that the word fittings may take in a projector or other apparatus used for a cinema but it is one thing to say that apparatus is fixed in a building and it is another to say that such fixture or apparatus is for the beneficial enjoyment of the building. Therefore it depends on the words used reflecting the legislative policy of each State Legislature. Indeed in Venkayya v. Venkata Subba Rao, AIR 1957 Andh Pra 619 a Division Bench of the Andhra Pradesh High Court considered whether the lease of a fixture comprising buildings and machinery came within the sweep of the rent control law. The court held that the lease of a running factory, comprising costly machinery intended to be used for manufacture, did not fall within the definition. The question in each case, the learned judges pointed out, would be what is the dominant part of the demise and what the main purpose for which the building was let out is. In Amritlal N. Shah v. Annapurnamma, AIR 1959 Andh Pra 9 the same court held that the lease of a cinema did not come within the purview of Madras Act 25 of 1949. Definitional ramifications need not detain us nor decisions turning on them.24. Shri Tarkunde pressed upon us the decision in Karsandas v. Karsanji, AIR1953 Sau l13 and Karnani Properties Ltd., v. Miss Augustine, AIR 1957 SC 309 . One of them did refer to a cinema theatre with fittings and generators. Certain Calcutta decisions, Kali Prosad v. Jagadish Pada, AIR 1953 Cal 149 and D. S. Jain v. Meghamala Roy, (1964) 68 Cal WN 1136 were also cited before us. In all these cases, the decision turned on the precise language used. We do not see any need to discuss these and the other decisions cited before us because we have explained why the conclusion we have reached is in consonance with the sense, purpose and language of the Act. For the same reason we content ourselves with merely, mentioning that in Harisingh v. Ratanlal 1969 Jab LJ 639 a Division Bench of the Madhya Pradesh High Court held that a fully equipped cinema theatre let out for showing films of a commercial basis, being of a running cinema theatre, fell out of the scope of accommodation on the score that costly fittings, fixtures and equipment could, in no sense, be regarded and meant for the beneficial enjoyment of the building in which the cinema theatre was housed. The primary object and the definitional language used determine the issue.25. Respondents counsel did try to approximate the definition in the Act to that found in the enactments with reference to which decisions in his favour had been rendered. We do not agree. To hair-split is an unhappy interpretative exercise. Here the plain intendment is to encompass leases of buildings only (inclusive of what renders them more congenial) but not of businesses accommodated in buildings nor of premises let out with the predominant purpose of running a business. A lease of a lucrative theatre with expensive cinema equipment, which latter pressed the lessee to go into the transaction, cannot reasonably be reduced into a mere tenancy of a building together with fittings which but make the user more comfortable.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]8. Looking at the three problems posed, unaided by the many decisions cited by counsel, we are inclined to the view that a lease of an accommodation must essentially be of a buildingnot a business or industry together with the building which it is situated. Of course, a building which is ordinarily let, be it for residential orpurposes, will not be the bare walls, floor and roof, but will have necessary amenities to make habitation happy. That is why the legislature has fairly included gardens, grounds and outhouses, if any, appurtenant to such building. Likewise, leases sometimes are of furnished buildings and that is why any furniture supplied by the landlord for use in such building is treated as part of the building. In the same strain, we may notice, as a matter of common occurrence, many fittings such as electrical fittings, sanitary fittings, curtains and venetian blinds andequipment being fixed to the building by the landlord so that the tenants enjoyment of the tenement may be more attractive. The crucial point is that these additions are appurtenant, subservient and beneficial to the building itself. They make occupation of the building more convenient and pleasant but the principal thing demised is the building and the additives are auxiliary. Where the lease is composite and has a plurality of purposes, the decisive test is the dominant purpose of the demise.9. Forgetting for a moment the clause introduced by the amending Act, it is plain that the furniture and fittings visualized in the concept of accommodation are calculated to improve the beneficial enjoyment of the premises leased. Counsel for the tenant has countered this interpretation by an ingenious and plausible submission. He emphasizes that the present building was conceived, designed and structured expressly as a cinema house conforming to the regulations in this behalf and the purpose of the owner was to use the auditorium and annexes purely as a cinema house. According to him, when a cinema theatre is erected, it becomes useless unless the necessary equipment for exhibiting films are also fitted up. In this view, the relative cost of the fixtures is immaterial and all these items, however costly, are calculated to fulfil the very object of the construction of the cinema theatre. In short, the fittings and furniture and like items are beneficial to and enhance the worth of the building and cannot be divorced or dissected from the whole object which animated the project of the building construction qua a cinema house. So presented, there is a certain attractiveness in the argument, although this facet of interpretation does not find a place in the submission on behalf of the respondent in the High Court.We have been at pains to explain that the subject matter of the leases covered by the definition of accommodation is any building or part of a building. We have carefully analysed the inclusive expressions in the original definition such as appurtenant gardens, grounds and outhouses furniture for use in the building and fittings affixed to the building. In this statutory context, gardens, outhouses, furniture and fittings mean annexures for the better enjoyment of the building. In this sense, the dominant intention must be to lease the building qua building. If that be the intention, the rent control law protects. On the other hand, if a going undertaking such as a running orand fully equipped cinema house is covered by the provision, the emphasis is not so much on the building but on the business, actual or imminent. There is nothing in the present definition which helps this shift in accent.12. We may reinforce our view from the expressions used, because all the three categories included as additions play a subservient role, while if a business were the subject matter of the lease, the prominent thing will be not what houses the business but the business itself. The building becomes secondary since every business or industry has to be accommodated in some enclosure or building. In all such cases, the lessor makes over possession of the building as part and parcel of the transfer of possession of the business. It would be a travesty of language to speak of a lease of a building when what is substantially made over is a business or industrial plant.There is some validity in this submission but if, on a fair construction, the principal provision is clear, a proviso cannot expand or limit it. Sometimes a proviso is engrafted by an apprehensive draftsman to remove possible doubts, to make matters plain, to light up ambiguous edges. Here, such is the case. In a country where factories and industries may still be in the developmental stage, it is not unusual to come across several such units which may not have costly machinery or plant or fittings and superficially consist of bare buildings plus minor fixtures. For example, a beedi factory or handicraft or carpentryfew tools, some small contrivances or collection of materials housed in a building, will superficially look like a mere accommodation but actually be a humming factory or business with a goodwill as business, with a prosperous reputation and a name among the business community and customers. Its value is qua business, although it has a habitation or building to accommodate it. The personality of the thing let out is a going concern or enterprise, not a lifeless edifice. The legislature, quite conceivably, thought that a marginal, yet substantial, class of buildings, with minimal equipments may still be good businesses and did not require protection as in the case of ordinary building tenancies. So, to dispel confusion from this region and to exclude what seemingly might be leases only of buildings but in truth might be leases of businesses, the legislature introduced the exclusionary proviso.17. While rulings and text books bearing on statutory construction have assigned many functions for provisos, we have to be selective, having regard to the next and context of a statute. Nothing is gained by extensive references to luminous classics or supportiveHaving explained the approach we make to the specific proviso situation in Sec. 2 (a) of the Act, what strikes us as meaningful here is that the legislature by the amending Act clarified what was implicit earlier and expressly carved out what otherwise might be mistakenly covered by the main definition. The proviso does not, in this case, expand, by implication, the protected area of building tenancies to embrace business leases.It is true that in Jaffer Alis case AIR 1971 Andh. Pra 156 (FB) and in Govindans case AIR 1966 Ker 244   (FB) (the Andhra and Kerala decisions referred to above) cinema theatres have been held to fall within the definition of building, under the relevant rent control law of those States. A bare reading of the two cases would show that certain amendments had been made to the parent statutes whereby the definition was expanded and its wide range was made to include all tenancies relating to all structures, even though accessories, furniture and fittings for use in the house were also made over. There is no doubt that the word fittings may take in a projector or other apparatus used for a cinema but it is one thing to say that apparatus is fixed in a building and it is another to say that such fixture or apparatus is for the beneficial enjoyment of the building. Therefore it depends on the words used reflecting the legislative policy of each State Legislature. Indeed in Venkayya v. Venkata Subba Rao, AIR 1957 Andh Pra 619 a Division Bench of the Andhra Pradesh High Court considered whether the lease of a fixture comprising buildings and machinery came within the sweep of the rent control law. The court held that the lease of a running factory, comprising costly machinery intended to be used for manufacture, did not fall within the definition. The question in each case, the learned judges pointed out, would be what is the dominant part of the demise and what the main purpose for which the building was let out is. In Amritlal N. Shah v. Annapurnamma, AIR 1959 Andh Pra 9 the same court held that the lease of a cinema did not come within the purview of Madras Act 25 of 1949. Definitional ramifications need not detain us nor decisions turning on them.