1. Petitioner who is running a cinema by name “Majestic Talkies” at Mulanthuruthy challenges the order Ext. P1 dated January 6, 1981 passed by the 1st respondent, the Executive Officer, Mulanthuruthy Panchayat refusing to allow his application for renewal of the licence to run the cinema.
2. 2nd respondent is the owner of Survey No. 346/2, Mulanthuruthy Village. In 1971 he granted a licence to the petitioner to erect a theatre and run a cinema in 10 cents of land in this survey number. The petitioner constructed a theatre and according to him, he had also to level the land for that purpose and installed the necessary machinery and obtained the requisite licence from respondent 1 who is the licensing authority under the Cinemas (Regulation) Act. He has been running the cinema from 16-12-1972. While the petitioner contends that the licence of the land in his favour was without any time limit, respondent 2 alleges that it was for a period of 5 years which expired on 1-12-1977. However that be, the petitioner used to obtain annual licences from respondent 1 not only till 1-12-1977 but till 1980 without any objection from respondent 2. When he applied on January 5, 1981 for a licence from January 6, 1981, respondent 2 filed an objection, Ext. R1 that even after the expiry of 5 years the petitioner had not vacated the land and that it had therefore become necessary to go to court to get the theatre removed and the land vacated. Respondent 1 thereupon passed the impugned order Ext. P1 that there was no letter of consent or other record to prove the petitioner's title, that he should produce his records, if available as early as practicable as licence could be granted only after being satisfied about the petitioner's title and possession and that he should therefore stop the cinema from that day onwards.
3. Both the respondents have filed counter-affidavits contesting the Original Petition. Respondent 1 states that in the absence of any record to support the petitioner's title or possession and in view of the objection by respondent 2, the Order Ext. P1 was passed, that even otherwise the petitioner was not entitled to the licence as his application was not presented within the prescribed time and was not accompanied by a fitness certificate from the. Health Officer. It was stated that although the delay in the submission of the application was not mentioned in the order Ext. P1, that has also been kept in mind in passing the order. By an amendment a further defence was taken that the petitioner was not entitled to any relief in the Original petition as he had a statutory right of appeal to the Panchayat. The defence of respondent 2 was that after expiry of the licence on 1-12-1977 he had not given any consent to the petitioner, that he had terminated the licence by a notice sent on 5-11-1980, that respondent 1 was right in rejecting the application for licence as the petitioner had no title or lawful possession of the property, that the application was defective and out of time and that Ext. P1 was correct. While admitting that the petitioner had constructed a theatre and installed machinery, respondent 2 states that the petitioner has exaggerated in the Original Petition the cost which he had to incur. Like respondent 1 he also contends that no relief should be granted to the petitioner as he had not availed himself of the statutory right of appeal.
4. Section 3 of the Kerala Cinemas (Regulation) Act enacts that save as otherwise provided in the Act, no person shall give an exhibition by means of a cinematograph elsewhere than in a place licenced under the Act, or otherwise than in compliance with any conditions and restrictions imposed by such licence. By Section 4 the licensing authority is the executive authority of the local authority within whose jurisdiction the place in respect of which the licence is to be granted is situate. Respondent 1 is admittedly the licensing authority. Rule 17 of the Rules framed under the Act provides by clause (iii) that the application for licence should be accompanied by documentary evidence pertaining to the ownership and possession of the site, building and equipment and if he is not the owner, documentary evidence to show that he is in lawful possession of the site, building and equipments to the satisfaction of the licensing authority.
5. The respondents' contention is that as the petitioner is not the owner of the land he must produce documentary evidence to show that he is in lawful possession of the site etc.; that this he has not done and that as the term of the licence has expired the licence is of no avail to support the application. They accordingly maintain that the order Ext. P1 is valid. Counsel for respondent 1 quoted Chockalingam v. Manickavasagam, AIR 1974 SC 104, in support of his contentions that the continuance of possession of the land by the petitioner after expiry of the term of the licence would not constitute lawful possession within Rule 17(iii). Counsel for the petitioner on the other hand maintained that the petitioner is entitled to the protection of Section 60(b) of the Easements Act, as acting upon the licence he has executed work of a permanent character on the land and incurred expenses in its execution and that the licence has thereby be come irrevocable rendering his possession lawful. This controversy is the main question round which the Original Petition revolves.
6. The petitioner has stated in the Original petition that he spent Rs. 2,500/- in levelling portions of the land and filling in others, that he constructed the theatre at a cost of Rs. 30,000/- and purchased machinery and furniture at a cost of Rs. 1,25,000/-. Except denying that the petitioner has levelled or filled in the land respondent 2 has not specifically contested the details given by the petitioner beyond stating that he has exaggerated the cost of the theatre, furniture and machinery. The petitioner has produced Ext. P6, copy of a certificate issued by the Assistant Engineer, P.W.D (B. & R.) Section, Mulanthuruthy which gives certain details of the theatre. It shows that the side walls are of laterite stone masonry, the floor of cement plaster, the posts of teak wood fixed in concrete, that the roof was thatched and the screen was supported on angle irons fixed in cement. The certificate proceeds to say that there was a compound wall with two steel gates on the front side and that as per the Kerala Cinema Rules the theatre could be considered as a permanent one except the roof of the auditorium. From the details given in the Original Petition and the data given by Ext. P6, it is plain that the theatre is a work of permanent character even though it might fall under the rubric of a temporary building under the Rules for the purpose of licence. What is not merely of a temporary nature must be treated as a work of permanent character. Considering the nature and purpose of the construction, I am of the opinion that the theatre is a work of permanent character which the petitioner has executed at his expense acting on the licence. This means that Section 60(b) of the Easements Act operates in his favour rendering the licence irrevocable.
7. The only point that remains to be considered under this head is whether the petitioner's possession is lawful within R. 17(iii). In Chockalingam's case, AIR 1974 SC 104, the question arose whether the possession of respondent 1, after expiry of the lease in his favour, was lawful possession which would entitle him to sustain an application for licence to run a cinema under Rule 13 of the Madras Cinemas (Regulation) Rules (the Rule corresponds to Rule 17(iii) of the Kerala Rules). After examining the scope and content of the expression ‘lawful possession’ the Supreme Court held that the possession of respondent 1 was not lawful possession. The Court also discussed when the possession of an ex-tenant whose tenancy has expired would be lawful possession. In the course of the discussion it was held (paragraph 14):
“In the context of R. 13, we are clearly of opinion that a tenant on the expiry of the lease cannot be said to continue in ‘lawful possession’ of the property against the wishes of the landlord if such a possession is not otherwise statutorily protected under the law against even lawful eviction through court process, such as under the Rent Control Act.”
8. It was further held (paragraph 15)
“The fact that after expiry of the lease the tenant will be able to continue in possession of the property by resisting a suit for eviction, does not establish, a case in law to answer the requirement of lawful possession of the property within the meaning of Rule 13. Lawful possession cannot be established without the concomitant existence of a lawful relationship between the landlord and the tenant. This relationship cannot be established against the consent of the landlord unless, however, in view of a special law, his consent becomes irrelevant.”
9. In my view, the position of the petitioner is of the nature contemplated in the above passages. The licence in his favour has become irrevocable and in view of the statutory protection which the law affords him the petitioner's possession is lawful. The Supreme Court has by way of illustration referred to the protection available, to an ex-tenant under the Rent Control Act as sufficient to make his possession lawful. In the present case the protection is afforded by another enactment, the Easements Act. The result cannot be different. As the possession of the petitioner was lawful the ground on which Ext. P1 is based is bad in law and cannot be sustained.
10. Although respondent 1 has raised a plea that the petitioner's application was defective in certain other respects I do not take note of them for the licence was not refused on those grounds.
11. Turning to the respondent's contention that in view of the right of appeal open to the petitioner I should not consider the merits of the case but should dismiss the Original Petition leaving the petitioner to pursue the appellate remedy, it is true that the order Ext. P1 is appealable under Section 144 of the Kerala Panchayats Act before the Panchayat and that the petitioner has not appealed from Ext. P1. I am not, however, pursuaded in the circumstances to uphold this contention and deny relief to the petitioner. The Original Petition was heard on 25-2-1981 when counsel for respondent 1 alone was present. At that hearing this objection was not taken. Subsequently, at the request of counsel for respondent 2 the case was posted for being ‘spoken to’ on 17-3-1981. At that hearing this point was urged by counsel for respondent 2 and also by counsel for respondent 1 who had filed an additional counter-affidavit that day taking this ground of objection. As it is, the objection was taken only after the case was virtually heard in full. I am not inclined in these circumstances to countenance the objection and dismiss the Original Petition on that ground.
12. What I have stated above on the petitioner's right is limited to his application for licence and is not meant to conclude the rights of respondent 2 under the licence including his right to take appropriate proceedings for getting the land vacated.
The order Ext. P1 is set aside. Respondent 1 will consider and dispose of the petitioner's application for licence in the light of the legal position explained above. As the petitioner has been granted a licence pending the Original Petition pursuant to the order of this Court, that licence will continue in force until the disposal of the application by respondent 1. The Original Petition is allowed in these terms, but in the circumstances without any order as to costs.
Petition allowed.