K.S.RAMAMURTHI, J. - (1.) THE main point that arises for decision in this case is whether the plaintiff (hereinafter called the lessees) are entitled to the benefits and protection under the Madras Buildings Lease and Rent Control) Act, 1960 (referred to herein as the Act) as amended by Madras Act (XI of 1964), in respect of a building or a Theatre known as " Odeon Cinema ". This Cinema theatre belonged to two brothers, the first and the second defendant in equal shares and the second defendant, since dead, sold his half share to defendants 3 to 5 under a registered sale deed, dated 14th October, 1966. As certain objections were raised concerning the rights of the plaintiffs to obtain a renewal of the licence under the Madras Cinema Regulations, the Commissioner of Police, has been impleaded as the sixth defendant.
(2.) THE relevant facts about which there is no serious controversy may be stated. The suit theatre which is now popularly known as " Odeon Cinema " belonged to defendants 1 and 2 and they were exhibiting pictures for several years in that theatre which Was then styled as " Sagar Talkies ". They had also obtained the requisite licence under the relevant Cinematograph Act, getting the licence renewed periodically. About the period April 1944 -45 to April 1952, one Somasundaram Chetty was exhibiting pictures in this theatre either as a lessee or with the leave and licence of the defendants 1 and 2 (hereinafter referred to as defendants). The Sahni brothers, the seniors and elders of the present partners of the plaintiff's firm, Isherdas Sahni and Bros., who were refugees from Punjab negotiated for the lease of the said theatre for a period of five years, the negotiations took some concrete shape and the main terms of the lease Were embodied in an agreement executed by the parties i.e., the defendants and one R. N. Sahni (now dead). This was followed up by a regular lease deed, (with certain changes) Exhibit P -4, dated 3rd May, 1952, executed by the defendants and Karam Chand Sahini (who is also dead) representing the Sahni Brothers. Detailed reference will be made to the terms and conditions of the lease deed. It is sufficient to state at this stage that the lease was for a period of five years upto 30th May, 1957 on a monthly rent of Rs. 4,25O with a right of renewal, at the option of the lessees, for a further period of five years. Schedule B appended to the lease deed sets out the various items, machinery, electrical machinery, talkie equipment, fittings, furniture and other accessories which Were covered by the lease. The list is fairly exhaustive and detailed and mentions all the items. In paragraph 3 -A of the lease deed, it is stated that out of the monthly rent of Rs. 4,250 Rs. 2,000 was to be the rent for the premises and the building, Rs. 1,000 hire for the furniture and Rs. 1250 hire for the machinery, electrical fittings, accessories and the talkie equipment With a specific mention that the lessees wanted to take the talkie equipment as a " Standby". A sum of Rs. 25,000 was paid by the lessees as advance stated to be as security for the articles hired to the lessees and that the advance of Rs. 25,000 shall be adjusted towards the rent and hire for the last six months preceding the termination of the lease. The several sub -clauses in Clause 5 contain the lessees covenants. Clause 5 (i) provides that alterations, improvements, additions to the building should be made by the lessees without causing damage to the building and that when they were so made, they Would become fixtures of the building and that the lessees would not be entitled to remove them at the termination of the lease, but that the lessors should be entitled to the same without any liability to pay any compensation therefor. Clause (f) provides that the lessees shall take proper care of the furniture and other fittings, machinery, talkie equipment and accessories and that if any damage is caused to the same, except by reasonable use and Wear, the lessees, shall replace the same or compensate the lessors for the value thereof. Clause 5 (7) provides that the lessee shall not dispose of or otherwise remove from the building (Without the consent of the lessors) any of the furniture, electrical fittings, fixtures which existed in the building at the time of the lease or may be hereafter (meaning after the lease) be provided upon the premises in substitution thereof except the talkie equipment. Clause 5 (p) provided that at the time of the determination of the lease, the lessees shall yield up the demised premises with the existing fixtures, electrical fittings, furniture, etc., set out in Schedules A and B appended to the lease or the substitutions thereof and that in default of doing so, the lessees shall pay Rs. 300 per day on such default.
(3.) IT is unnecessary to advert to the terms of Exhibit P -2, dated 2nd April, 1952 which the parties put into Writing when the lease was agreed upon, as the regular registered lease deed Exhibit -P -4 which Was executed a month later embodies (with some modifications) in detail, all the terms and conditions of the lease, mentioned above. It is important to advert even at this stage to the two projectors with talkie equipments; (1) "Simplex" Projector and talkie equipment which was no longer in use and referred to as stand -by equipment; and (2) " Westrex" Projector with talkie equipment which was obtained under a hire -purchase agreement from Messrs. Westrex Company even during the time of the prior lessee, Somasundaram. As a result of and as part and parcel of the lease deed, Exhibit P -4 it was agreed between the parties that the lessees should pay to the lessors the instalments of hire -purchase paid up till then to Westrex Company and that the lessees should also continue to pay the entire future instalments as and when they accrued due. The substance of the arrangement was that so far as the Westrex Projector and talkie equipment were concerned, they are the properties of the plaintiffs. On this aspect, it is sufficient to refer to Exhibit - P -1, dated 25th March, 1952, the letter passed by Somasundaram to the defendants; Clause 3 of Exhibit P -2, dated 2nd April, 1952, and Exhibit P -3 a letter, dated 5th April, 1952 passed by the defendants to the plaintiffs; Exhibit P -74, dated 4th September, 1952, a letter by the Westrex Company, India to the defendants; Exhibit P -90 a transfer voucher showing a cheque, dated 28th October, 1952 given by the plaintiffs to the defendants for a sum of Rs. 7000 and Exhibit P -120 showing the instalments of payments made by the plaintiffs to the Westrex Company. By the end of 1954, the plaintiff became the full -fledged and absolute owners of this Westrex Projector and talkie equipment, they having paid to the defendants the sum of Rs. 7,000 and the entire balance of instalments, to the Westex Company. Exhibit P -120 extract shows that the plaintiffs, in addition to the price of the talkie equipment, have spent and incurred several items of expenditure with regard to the change of lenses and other component parts making a total of Rs. 59,500 towards the capital investment and expenses incurred under this head -Mr. Govind Swaminathan, learned Counsel for the defendants fairly conceded that so far as the Westrex talkie equipment Was concerned, the case could be dealt with on the footing that it belonged to the plaintiffs and that as per the conditions of the lease deed, the lessees would be entitled to remove and take them at the termination of the lease deed and that the lessors will not have any right or claim thereto. To continue the narrative, the lessees took possession of the theatre and effected considerable improvements, spending large sums of money in connection with Various items, interior decoration, electrical fittings, sanitary fittings, furniture, gates, etc. From the extracts of the entries all culled out from the account books, it is seen that the plaintiffs have invested about Rs. 1,16,000 and odd under the various items. The entire seating arrangement was changed and except for a few items, the entire furniture had been replaced by new furniture which the plaintiffs purchased from " Pen Workers" the furniture company, in Bombay. As observed earlier, the plaintiffs changed the name of the theatre from " Sagar Talkies " to " Odeon Cinema ". In fact, even though the lease was executed on 3rd May, 1952, the plaintiffs did not screen any picture in the theatre immediately, but took up the Work of renovation, remodelling and improvement of the theatre, and it was only' on 27th June, 1952 that the first show commenced in the theatre preceded by a grand opening ceremony on the previous day on 26th June, 1952. ;