Case: Dwarka Prasad Vs. Dwarka Das Saraf

2. The facts are few and may be stated briefly, although, at a later stage, further details may have to be mentioned at relevant places to illumine the arguments advanced on both sides by counsel, Shri R. K. Garg (for the appellant) and Shri V. M. Tarkunde (for the respondent). Shortly put, the legal issues are only three: (A) Is a cinema theatre, equipped with projectors and other fittings and ready to be launched as an entertainment house, an accommodation as defined in Section 2 (1) (d) of the U. P. (Temporary) Control of Rent and Eviction Act, 1947 (U. P. Act III of 1947) for short, the Act) ? (B) If it is an accommodation as so defined what is the impact of the proviso brought in by amendment in 1954 (Act XVII of 1954) (for short, the Amending Act)? (C) If the Act barricades eviction by the landlord because the premises let constitutes an accommodation, does the repeal of the Act and exclusion of cinema houses altogether from the operation of the 1972 Act (U. P. Act 13 of 1972) (for short, the later Act) rescue the right of theto eject theThe building covered by the suit is admittedly one built and adapted for screening films. The plaintiff had been carrying on a cinema business in this theatre for a long number of years but, when he discontinued, the defendant approached him in January 1952 for the grant of a lease of the building with all the equipment and fittings and furniture necessary for his operating the cinema. The necessary certificates, sanctions and permissions, preliminary to the conduct of cinema shows, stood in the name of the plaintiff, includingconnection, electricity supply and structural fitness. Before commencement of cinema shows, a licence is necessary under the U. P. Cinemas (Regulation) Act and this licence has to be taken out by the actual operator of the cinema and not by the landlord of the theatre and equipments. Therefore, once the lease for the entire building and cinema projector, accessories and the like was finalised, the deed of demise was actually executed, it being provided that the commencement of the lease would synchronize with the inaugural cinema show on March 25, 1953. It was provided in the lease deeds that the rent for the building,simpliciter, may be shown separately from that attributable to the costly equipments, for the purposes of property tax and other taxes. By this apportionment, the building, as such, was to bear a burden of Rupees 400/per mensem by way of rent and a monthly sum of Rs. 1,000/was fixed for the projector and all other items fixed in the building. The leases were renewed from time to time till 1959. The suit for eviction was based on these leases which formed the foundation of the action.4. At this stage it may be noticed that the learned counsel for thedid not dispute that running a cinema business did constitute anindustrial purposeso that the accommodation was used for an industrial purpose. Another significant fact admitted by the defendants counsel before the High Court was that for the purpose of this case, in spite of there being separate documents of lease in respect of the demised properties as referred to above, these sets of contracts may be treated as a single transaction each time. On these facts and circumstances, we have to decide whether the subject matter of the demise is an accommodation within the meaning of the Act. After settling this issue, the other two points adverted to above may have to be considered. While the trial Judge held that the suit property was not an accommodation within the sweep of the Act, the High Court, on appeal before a Division Bench, could not agree and, on account of the difference of opinion between the two Judges who heard the appeal, the case was posted before a third Judge who took the view that the subject matter of the lease in question was an accommodation within the meaning of the Act. The suit, on this view, had to be dismissed. The aggrieved landlord has come up to challenge this judgment.

Court's reasoning:
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.