S. Leelavathy vs K.M. Subramaniam (died) and Others

S.R. Singharavelu, J.—This appeal arises against the judgment and decree passed by the learned Principal Subordinate Judge at Erode, in

O.S. No. 285 of 1990 dated 17.02.1995, in decreeing the suit for recovery of possession, past and future damages for use and occupation of the

property at the rate of Rs. 800/- per month. Defendant is the appellant. The claim made by the plaintiff was at the rate of Rs. 1500/- per month

and as the decree was passed only for Rs. 800/- per month, there is a Cross Objection filed by the plaintiff.

The subject matter of the suit was described in the plaint as ''B'' schedule and by reading the plaint, one may understand that it is a property

described in Ex.A-1 lease deed dated 18.04.1979. That was the lease deed in between the parties in respect of 90 cents of vacant land out of

total extent one acre and add. The respondent/ plaintiff is admittedly the owner. The appellant/defendant is the lessee under Ex.A1. The monthly

rent was fixed at Rs. 400/- per month. The appellant/defendant was also permitted to construct a screen printing factory and accordingly, the

appellant had constructed the same and is running the said factory. The lease period mentioned was five years.

Although it was stated that the appellant/defendant had surrendered possession on 26.04.1985 and that the respondent/plaintiff had filed a suit in

O.S. No. 381 of 1985 for permanent injunction in respect of that property, the fact remains that the suit was dismissed on 16.06.1988 for default.

Apart from the allegation made by the appellant/defendant that the respondent/plaintiff had forcibly made entry on 05.05.1985, the present

possession is admitted with the appellant/defendant. That is why, perhaps, the suit in O.S. No. 381 of 1985 was dismissed for default of the

respondent/plaintiff. Since only the appellant/ defendant continues in possession, the respondent/plaintiff had chosen to terminate the tenancy

through Ex.A2 notice dated 07.09.1988 requiring the appellant to deliver possession by the end of September 1988; that was a 15 days'' notice

issued in accordance with Section 106 of Transfer of Property Act.

Mr. A.K. Kumarasamy, learned Counsel appearing for the appellant/defendant submitted that the notice is invalid in the eye of law inasmuch as

usage of the premises by the appellant/defendant was admittedly for running a screen printing factory, which is engaged for the process of

manufacture of cotton sarees, in which designs are printed in the said factory. Therefore, it was contended that as per Section 106 of the said Act,

when the lease of immovable property is for agricultural or manufacturing purposes, the notice of termination should be by a period of six months.

In this case, no notice was issued giving six months time. Ex.A2 was only a 15 days'' notice. So, it was urged that the notice under Ex.A2 is invalid

in the eye of law. Therefore, the learned Counsel submitted that the decree of recovery of possession is to be set aside.

Mr. V.K. Muthusamy, learned senior counsel appearing for the respondent/plaintiff submitted that the screen printing work done in the factory

of the defendant in the suit premises may not be called as a manufacture and, therefore, only 15 days notice given under Ex.A2 is valid. In this

connection, reliance was placed upon the decision reported in Idandas v. Anant Ramchandra 1982 SC 127, wherein the tests for determining

whether a lease is granted for purpose of ""manufacturing process"" were mentioned as follows:

(i) That it must be proved that a certain commodity was produced;

(ii) That the process of production must involve either labour or machinery;

(iii) That the end product which comes into existence after the manufacturing process is complete, should have a different name and should be put

to a different use. In other words, the commodity should be so transformed as to lose its original character.

That was a case where a lease was granted for running a flour mill wherein wheat was transformed, by manufacturing process which involved both

labour and machinery, into flour. Therefore, it was held that all the three tests were fully satisfied and thus the lease was one for manufacturing

process which could be terminated only by giving six months'' notice u/s 106 of Transfer of Property Act.

While discussing the logical aspect of the case, the observation found in Allenbury Engineers Pvt. Ltd. Vs. Ramkrishna Dalmia and Others, at

page 427 was relied on and which is as follows:

The word ''manufacture'', according to its dictionary meaning, is the making of articles or material (now on large scale) by physical labour or

mechanical power (Shorter Oxford English Dictionary, Vol. I 1203). According to the Permanent Edition of Words and Phrases Vol.26,

''manufacture'' implies a change but every change is not manufacture and yet every change in an article is the result of treatment, labour and

manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name,

character or use"".

Again, the following observation found in Joyanti Hosiery Mills v. Upendra Chandra Das AIR 1946 Cal 317 was also relied upon.

To manufacture"", according to its Dictionary meaning means ""to work up materials into forms suitable for use"". The word ''material'' does not

necessarily mean the original raw material, for a finished article may have to go through several manufacturing processes before it is fit and made

ready for the market. What is itself a manufactured commodity may constitute a ""material"" for working it up into a different product. ""Thus, for

example for the tanner, the material would be the raw hide, but the leather itself a manufactured article would constitute the material for the

shoemaker''s business, and we cannot say that the shoe-makers are not manufacturers because they do not work on raw hides"".

In the case of John Augustine Peter Mirande v. N. Datha Naik AIR 1971 Mys 365, the observation was as follows:

In common parlance ''to manufacture goods'' means ''to bring goods into being''. The essence of manufacture is the changing of one object into

another for the purpose of making it marketable. Therefore, the proper approach for ascertaining the meaning or expression of the word

''manufacture'' is to see in the context in which it is used.

The same was relied upon in Meghraj and Others Vs. B. Seshagiri Rao, , wherein it was observed that to constitute ''manufacture'' there must

be such transformation in the change out of which a new and different article must emerge having a distinctive name, character or use.

Again in UOI. v. J.G. Glass Industries Ltd. 1998 (97) ELT 5 11 (SC), the Supreme Court has laid down a two-fold test for deciding whether

the process is ''manufacture''. First, whether by the said process a different commercial commodity comes into existence or whether the identity of

the original commodity ceases to exist. Secondly, whether the commodity which was already in existence will serve no purpose but for the said

process. Applying the two-fold test, it was held that printing on bottles does not amount to manufacture.

In Oudh Sugar Mills Ltd. v. Union of India 1982 ELT 937, it was held that,

The word ''manufacture'' is a verb which is generally understood to mean bringing into existence a new substance and not merely to produce some

change in substance however minor it may be. The word includes any process incidental or ancillary to the process of a manufactured product.

Manufacture at intermediate stage: It is not correct to state that until a final or last product is made, there will be no manufacture. If in the

intermediate stage a distinct product known to the commercial world comes into existence, manufacture does take place.

Now, there is no distinct product known to the commercial world that comes into existence because it was the same category of saree either

prior to or after the printing. Printing may create a change; but all changes are not new manufactures. There is no occurrence of transformation into

usable commodity; because even earlier to printing it was an unprinted but at the same time, usable commodity.

Considering the above definitions and circumstances in which the term ''manufacture'' was to be understood, it could be said that any product

of a fabric because of its undergoing printing may not involve any transformation and therefore, in this case, no manufacture gets itself involved.

Above all, it is very much pertinent to note that no proper plea in this regard was taken in the written statement of appellant/defendant. The

present argument of the learned Counsel for the appellant that as this happens to be squarely a legal problem or question of law, the appellant

cannot fail for no plea in that respect, is unacceptable because although it may appear that what is involved is a question of law, for inviting such

question on Section 106 of Transfer of Property Act, it must have been pleaded that there is a basic fact in favour of the appellant/defendant and

that fact will get Section 106 attracted for the issuance of six months'' notice. When such factum is not pleaded, an application of law u/s 106 of the

Act may not become necessary. In that way, the failure to make plea of question of fact in order to apply a law or in order to make it a question of

law may go against the appellant. So, viewed in any angle, the notice under Ex.A2 is found valid.

The next question that would arise is about the quantum of damages. Learned Counsel for the respondent/plaintiff would be entitled for a sum

of Rs. 1500/- per month for the reason that there is escalation of price mainly in and around Erode and that too, when the suit property is lying in

an important locality of Erode and on the bank of Cauvery river. While fixing damages, we cannot ignore terms of agreement between the parties,

that was only for Rs. 400/- per month. Of course, that was agreed in April 1979. But the trial court has considered all the aspects in its judgment.

Here, the respondent/plaintiff claimed a sum of Rs. 1500/- per month and for reasons mentioned in the judgment of the lower court, it has fixed at

the rate of Rs. 800/- per month and the same is confirmed. In view of the above circumstances, I am not inclined to grant any time for vacating the

same as pleaded by the learned Counsel for the respondent/appellant.

For the reasons stated above, both the Appeal as well as Cross Objection are dismissed. No costs.