M/s R.M.S. Exhibitors vs M/s. C.P. Pictures (Pvt.) Ltd.

M.M. Qazi, J.—Non-applicant Company is the successor of the original lessees (1) M/s. Cowashah Bhomonji Parekh, () Framroze Edulji Daruwalia. and (3) Mohd. Sayed Badruddin, while the applicant is the successor of the original lessors (1) MRs. Bapaimav Darsha Doongaji and (2) MRs. Cooverbai D.Doongaji. The non-applicant is a private limited Company duly incorporated under the Indian Companies Act. The property which is the subject-matter of the suit consists of a plot of land known as ''Bharat Cinema Land''.

Under a lease-deed 20th April, 1933 the land called as ''Bharat Cinema Land'' was . given as lease for a period of 25 years commencing from 1.5.1933. The period of lease was to end on 30.4.1958. The lease was duly registered. The lessees were entitled to build a theatre for running a cinema. The non-appellant Company constructed a building called as ''Bharat Cinema Theatre'' and equipped the same with up to date Projectors and other necessary equipments. Before the expiry of the period of 25 years of the lease, defendant No. 1 MRs. Cooverbai D.Doongaji vide her letter dated 11.11.1957 informed the non-applicant company that all the correspondence had to be endorsed to her son Shri R.D.Doongaji at his Bombay address. In the mean-time, a letter dated 21.9.1957 from defendant No. 8 H.D.Doongaji was received by the non-applicant Company, whereby the Company was called upon to submit the proposal for renewal of the lease and all that was suggested was to pay a higher rent for the land. Discussions for the renewal of the lease continued and ultimately a contract for the renewal of the lease was entered into and the terms settled between the applicant and the non-applicant for the renewal of the lease in respect of the land known as ''Bharat Cinema'' for a period of 30 year with effect from 1.5.1958. However, the formal document of lease deed remained to be completed. The non-applicant Company pressed for the execution of the lease-deed, but since the same was avoided by the applicant, Civil Suit No. 365 of 1965 for specific performance of contract came to be filed by the non-applicant/plaintiff, contending the notwithstanding that the non-appellant Company was ready and willing to perform its part of the contract, the applicant did not execute the formal document of lease. According to the averments in the suit, since everything was settled, the non-appellant Company continued to pay the enhanced rent at the rate of Rs. 500 per month. The suit was compromised on 30.11.1968, and a decree in terms of the compromised was passed.

Clause (h) was one of the terms of the compromise, which now formed part of the decree, reads thus.:

"(h) At the end of the period of lease dated 28.10.1965 between S.M. Solao and the defendants 2 to 9 the plaintiff Company shall have an option to continue its structures, fixtures, etc. on the land on terms and conditions as may be settled between the plaintiff Company and the defendant 2to 8. The plaintiff Company shall be given an option to obtain the lease from the defendant 2 to 8 in respect of the land in question on such terms and conditions as may ultimately be settled between the defendants 2 to 8 and the plaintiff Company, or defendant 2 to 8 may exercise the option of purchasing the building and structures on the land in question at the market value. The aforesaid option shall not, however, be exercised by defendants 2 to 8 in any manner, or even in terms of the lease deed dated 28.10.1965 at any time until 31st of October 1985 but only after 31st October 1985.

Notwithstanding the compromise which was incorporated in the decree, the applicant did not execute the formal document of lease even though the non-applicant Company continued to press for the same. Hence, the Court was moved for execution of the decree, which was opposed: It appears to have been opposed on the ground that the decree was not executable. The trial Court rejected the contention of the applicant and hence this revision application.

Mr. K.H. Deshpande appearing for the applicant raised two grounds, viz.(1) that the compromise decree was outside the scope of the original suit, and (2) that it was not executable. He invited my attention to Order XXIII, Rule 3 of the Code of Civil Procedure, as to stood prior to amendment, which is reproduced below :

"(3) Where it is proved to the satisfaction of the Court that a suit has been adjusted wholly or in part by any lawful agreement or compromise or where the defendant satisfies the plaintiff in respect of the whole or any part subject-matter of the suit, the court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far as it relates to the suit."

He also cited certain decisions in support of his contention that if the compromise decree is outside the scope of the suit, it cannot be executed. It is not necessary to refer to those decisions since the provision, quoted supra, is quite clear. Therefore, the crucial question that fails for my consideration is whether the decree passed in the instant proceedings can be said to be outside the scope of the original suit. There is no dispute that in order to find out whether if it outside the scope of the original suit or not, that will have to be decided on the contents of the plaint. While narrating the facts I have already referred to the relevant contents of the plaint which clearly go to show that renewal of the formal document of lease was very much the subject-matter of the suit. The plaint refers to the original lease deed which was entered into for a period of 25 years commencing from 1.5.1933. It further recites that before expiry of the period of 25 years lease the non-applicant Company as called upon to renew the lease on a higher rent.

The lessor Shri R.D. Doongaji directed the non-applicant Company to finalize the agreement of lease. It further recites that discussions for renewal of the lease continued and ultimately the terms were settled which are incorporated in the plaint. However, formal document of lease was not executed inspite of the fact that the non-applicant Company was continuously pressing for the same. It is further stated in the plaint that under the terms which was settled the lease-deed was to be executed for 30 years with effect from 1.5.1958, which was to expire on 1.5.1988. In view of these facts, there is no substance in the submission of Mr. Dashpande that the compromise decree was beyond the scope of the suit.

Mr. Deshpande Vehemently contended that the decree is not executable. According to him, the decree cannot be executed until the terms and conditions of the lease-deed are settled as required by clause (h) of the compromise decree. I have already shown above that as per the contents of the plaint all the terms and conditions were settled between the parties and all that remained to be done was the execution of the formal document of lease-deed. Knowing this full well, the applicant entered into the compromise and requested the Court to pass a decree in terms of the compromise. He is now estopped from saying that the decree is not executable until the terms and conditions of the compromise are settled. The trial court has, in my view, discussed this aspect quite exhaustively and has rejected the contention of the applicant. It may also be observed here that the impugned compromise decree was also the subject-matter of the decision of this Court in Appeal from order No. 51 of 1984 with Appeal from Order No. 8 of 1985 decided on 10th October 1985, and this Court has also acted on the compromise decree under dispute. Having regard to all these facts, I see no reason to interfere with the impugned order. The revision application is dismissed with costs.