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1965 Supreme(Cal) 7

HIGH COURT OF CALCUTTA
D. N. SINHA, A. K. MUKHERJI
STERLING INVESTMENT CORPORATION PVT. LTD. - Appellant
Versus
SUSHILA DEVI RAMPURIA - Respondent
A. F. O. O.  129  Of  1962
Decided On : JANUARY 13, 1965

Advocates Appeared:
G.MITTER, M.L.Mehta, R.C.DE, S.SEN, SOMNATH CHATTERJEE

The court has the discretion to grant or refuse an adjournment, but this discretion must be exercised judicially. In the present case, the trial court erred in refusing to grant an adjournment to the appellant to amend the summons and serve it on the other defendants, as the appellant had a strong prima facie case for revocation of leave and the balance of convenience was overwhelmingly in favor of the suit being tried in Bombay.

Headnote:

LETTERS PATENT - Clause 12 - Revocation of Leave - Jurisdiction - Balance of Convenience - Adjournment - Amendment of Summons - Discretion of Court - Judicial Exercise.

Fact of the Case:

The appellant, a film producer, entered into an agreement with Messrs. Chitrabani, a film distributor, for the distribution of the film 'Mughal-E-Azam'. Disputes arose between the parties, and Messrs. Chitrabani filed a suit in the Bombay High Court against the appellant and others. The appellant also filed a suit in the Bombay High Court against Messrs. Chitrabani. Subsequently, a suit was filed in the Calcutta High Court by one Sm. Sushila Debi Rampuria against the appellant, seeking various reliefs, including a declaration that the agreement between the appellant and Messrs. Chitrabani had been terminated. The appellant applied for revocation of leave granted to the plaintiff under Clause 12 of the Letters Patent to institute the suit in the Calcutta High Court. The application was dismissed by the trial court on the grounds that the summons had not been served on all the parties and that the application had no merits.

Finding of the Court:

The court held that the trial court erred in refusing to grant an adjournment to the appellant to amend the summons and serve it on the other defendants. The court found that the appellant had a strong prima facie case for revocation of leave and that it was necessary for the plaintiff to meet the appellant's case on merits. The court also held that the balance of convenience was overwhelmingly in favor of the suit being tried in Bombay, where most of the facts and transactions took place.

Issues: 1. Whether the trial court erred in refusing to grant an adjournment to the appellant to amend the summons and serve it on the other defendants? 2. Whether the appellant had a strong prima facie case for revocation of leave? 3. Whether the balance of convenience was overwhelmingly in favor of the suit being tried in Bombay?

Ratio Decidendi: 1. The court held that the trial court erred in refusing to grant an adjournment to the appellant to amend the summons and serve it on the other defendants. The court found that the appellant had a strong prima facie case for revocation of leave and that it was necessary for the plaintiff to meet the appellant's case on merits. The court also held that the balance of convenience was overwhelmingly in favor of the suit being tried in Bombay, where most of the facts and transactions took place. 2. The court held that the appellant had a strong prima facie case for revocation of leave. The court found that the appellant had made out a very strong prima facie case and that the plaintiff had no argument to advance in reply to the appellant's contention on this point. 3. The court held that the balance of convenience was overwhelmingly in favor of the suit being tried in Bombay. The court found that only a microscopic part of the evidence in the instant suit would relate to what took place within the jurisdiction of the Calcutta High Court, while all the other facts and transactions took place in Bombay.

Final Decision: The court allowed the appeal, set aside the judgment and order of the trial court, and remanded the application for further hearing. The court directed that the appellant be given an opportunity to amend the summons and serve it upon the other defendants.

ARUN K. MUKHERJEA, J.

( 1 ) THIS appeal is from a judgment and order dated June 14, 1962 passed by Ray, J. by which Ray, j. dismissed an application of the appellant for revocation of leave under Clause 12 of the Letters Patent which had been granted to the plaintiff in the instant suit. The facts of the case are briefly as follows.

( 2 ) THE appellant is u private limited company with its registered office at Bombay and if* a producer of cinematographic films and motion pictures. The appellant produced u film called "mughal-E-Azam". On or about June 19, 1959 there was an agreement in writing by and between the appellant and a firm named Messrs. Chitrabani by which the appellant appointed the said Messrs, Chitrabani as the sole distributor of the said film for a territory which is known to the film trade as Bombay circuit. Under that agreement the said Messrs. Chitrabani were given license for sole and exclusive exhibition, distribution and exploitation of the picture in the said Bombay circuit. Messrs. Chitrabani (described as "distributors' in the said agreement) agreed to give to the appellant who has been described as "principals" in the agreement. as and by way ol minimum guarantee of business on that picture, a sum of Rs. 16,00,000. Thai, sum was to be paid in Bombay in the following manner: (a) Rs. 5 lacs was to be paid on or before the execution of the agreement; (b) Rs. 2 lacs within 45 days of the signing of the agreement; (c) Rs. 2 lacs within 7 days of the censor of the picture; (d) Rs. 7 lacs against delivery in Bombay of certain prints of the picture in accordance with a schedule attached to the agreement. This sum was to be paid within 15 days from the date of call for the amount by the principals to the distributors at their Bombay address. It was further agreed that payment in time of the aforesaid amounts and the delivery oi: prints mentioned in Schedule A to the agreement within six months from the date of the agreement were to be the essence of the agreement. It was further agreed that the distributors were to take delivery of the prints within 15 days from the date of a written intimation given to that: effect by the principals. In the event of the failure of the distributors to take delivery of the prints within the stipulated time the principals were to be at liberty to give the distribution, exploitation, and exhibition rights of the picture to other parties and in that event the principals were to be entitled to adjust monies paid to them by the same distributors to the extent of recouping the principals' losses and damages. The principals agreed to do pre-release publicity upto Rs. 2 lacs at their own cost. It was further agreed that the exploitation income derived by the distributors in the business done cm the aforesaid picture was to be utilised in the following manner: (a) towards the recoupment of the payment of the minimum guarantee of Rs. 16 lacs; (b) after recouping the aforesaid sum the distributors were to adjust a total commission of 15 per cent on the income received in respect of the minimum guarantee of Rs. 18 lacs, that is to say, the distributors were to appropriate a total sum of Rs. 1. 6 lacs plus Rs. 2,70,000 as commission; (c) after adjusting the aforesaid amount of Rs. 18,70,000 and the cost of any extra prints taken by the distributors over and above the stipulated prints free of cost, the balance of the income was to be shared at the rate of 25 per cent as their commission and 75 per cent was to be paid to the principals as their share of the income. This was to be held in trust by the distributors and paid on or before the 25th of every following calendar month. The distributors agreed not to sell the picture in any part or parts of the contracted territory without the prior written consent of the principals. The distributors also undertook not to exhibit or exploit the said picture directly or indirectly outside the contracted territory and it was agreed that in the event of













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