1. The petitioner firm is the owner of a cinema house, Sri Balkrishna Talkies, Tuticorin: The petitioner held in its own name a licence issued in form A under the Cinematograph Act, Central Act, Central Act II of 1918. The certificate issued in form D by the Chief Electrical Inspector also stood in the name of the petitioner. The licence and the certificate last issued to the petitioner, were valid unto 30-11-1954. Clause 7 of the licence in form A ran:
"The licence shall not, without the permission of the licensing authority, assign, sublet or otherwise transfer the licence or the licensed premises; nor shall the licensee without the permission as aforesaid allow any other person during the period of currency of the licence, to exhibit films in the licensed premises".
2. On 11th March 1954 the petitioner executed a deed of lease in favour of the first respondent. What was leased was described in Clause 1 of the deed as
"all that piece or parcel of land together with the building and premises known as Sri Balakrishna Electric Theatrical Hall, furniture, electrical fixtures and talkie equipment except the western room exclusively reserved for use by the lessor ......"
Clause 11 of the lease deed provided:
"The cabin room shall be under the control and custody of the lessor or his paid servants and the operators shall be paid by the lessor".
3. It was common ground that before granting this lease under which the lessee took possession, the petitioner did not obtain the sanction of the licensing authority. Clause 7 of the licence in form A was contravened by the grant of the lease. On 18-11-1954 the Collector and the District Magistrate of Tirunelveli, the licensing authority, cancelled the licence in form A that had been granted to the petitioner. But for that cancellation the licence would have been in force upto 30-11-1954.
4. It was common ground again that the first respondent applied for and obtained licences in form A for the period 1954-55 and 1955-56.
5. Under rule 7 (1) (b) of the Madras Cinematograph Rules, 1933, the fee for the inspection by the Chief Electrical Inspector of an officer deputed by him that has to precede the issue of a renewed certificate in form D has to be paid three months before the date of expiry of the validity of the certificate in form D already in force. Apparently long before 18-11-1954, when the A form licence held by the petitioner was cancelled for contravention of Clause 7 of the licence, the petitioner had applied in the usual course for the grant of the certificate in form D for 1954-55. It would appea-that the form D certificate was ordered to be renewed in favour of the petitioner for the period 1-12-1954 to 30-11-1955. The certificate itself came into the custody of the first respondent who was the lessee, though how that came to pass no one really explained.
6. On 27-10-1954, the first respondent applied, apparently to the licensing authority, to transfer the D form certificate for 1954-55 in the name of the first respondent. On 24-11-1954, the Collector and District Magistrate issued a notice to the petitioner to show cause why the first respondent's application should not be complied with. The petitioner submitted his written, representations objecting to the transfer of the D form certificate to the first respondent.
7. It was the Chief Electrical Inspector' that had to issue, and did issue the D form certificate. On 27-12-1954 he ordered the transfer sought by the first respondent. That transfer had been recommended earlier by the Collector, apparently after considering the representations submitted by the petitioner in response to the notice issued to it on 24-11-1954.
8. The petitioner professed ignorance of this transfer, and the learned counsel contended that the petitioner came to know of this transfer for the first time only from the averments in the counter affidavit filed in these proceedings by respondents 2 to 4. On 21-2-1955 and 21-7-1955 the petitioner addressed the Government for the issue of orders on the objections formulated by the petitioner to the transfer of the D form certificate, which the first respondent had applied for. On 11-11-1955 the Government directed:
"The Collector is requested to proceed with the case on its merits under the existing orders on the subject".
On 10-1-1956 the Collector and District Magistrate, as the licensing authority under the Act, issued an order hi the following terms:
"With reference to Government memorandum cited, Sri P. Section T. P. Ramasabapathi Nadar, the managing director of Tuticorin Cinema Co., Ltd., Tuticorin is informed that his request end objections against the transfer of Electrical certificate of Sri Balakrishna Talkies, Tuticorin, in the name of M/s Charles Missier Sons, Tuticorin, and also to the grant of A form licence under the Cinematograph Act in the name of M/s Charles Missier and Sons, Tuticorin, cannot be allowed. He is also informed that the Eletrical certificate, has already been renewed in the name of M/s Charles Missier and Sons, Tuticorin, and that the licence in form A under the Cinematograph Act will also be renewed in the name of M/s Charles Missier and Sons. If he has any right over the cabin room or electrical apparatus he has to work out his right in a civil court".
9. The petitioner preferred what purported to be, an appeal against the order of the Collector dated 10-1-1956. By its order dated 31-5-1956 the Government informed the petitioner that the Government declined to interfere in the matter.
10. The petitioner applied under Art. 226 of the Constitution for the issue of a writ of certiorari or other appropriate writ to quash the order of the Collector dated 10-1-1956 transferring the form D certificate of Sri Balakrishna Talkies, Tuticorin, and also the grant of the A form licence in the name of the first, respondent. Despite these specific prayers, the learned counsel for the petitioner represented that the petitioner firm confined itself only to the question, whether the order transferring the D form certificate for 1954-55 to the first respondent was valid. The learned counsel for the petitioner specifically represented that the petitioner was not putting in issue in these proceedings the grant of the licence in Form A to the first respondent for 1954-55 or 1955-56.
11. Though in form it was the validity of the order of the Collector dated 10-1-1956 and that of the Government dated 31-5-1956, which in effect confirmed the order of the Collector dated 10-1-1956, that were attacked by the petitioner, it should be noticed that the transfer of the D form certificate for 1954-55 was ordered by the Chief Electrical inspector on 27-12-1954. In effect, what the Collector did on 10-1-1958 was to inform the petitioner that the transfer already ordered on 27-12-1954 would stand, despite objections of the petitioner.
12. The learned counsel for the petitioner contended that neither the Chief Electrical inspector nor the Collector as the licensing authority had any jurisdiction under the Act or under the rules framed thereunder to order a transfer of a certificate that had been granted in form D.
13. There is no specific reference to a certificate in form D in the Act itself. Section 5(1)(a) of the Act, however, authorises the issue of a licence, the licence in form A, only when the licensing authority is satisfied that the rules made under the Act have been substantially complied with. Rule 7 (1) (b) provides for the inspection by the Chief Electrical inspector and for the issue of the certificate of registration in form D on payment of the prescribed fees. Rule 11 provides for an application being made to the licensing authority Per the issue of a licence in form A. Rule 12 (1) directs that the licensing authority shall forward the application and its enclosures to the Chief Electrical Inspector.
If the Chief Electrical inspector is satisfied he shall issue a certificate in form D and forward it to the licensing authority. Rule 13, directs that on the grant to the applicant of a licence in form A, the Chief Electrical inspector's certificate shall also be delivered to the applicant along with the licence. It is true no specific provision has been made even in the rules for the transfer of a certificate in form D during the period of its currency. Respondents 2 to 4 claimed that it was under the Government Memorandum. No. 56082, dated 27th June 1950 that the Chief Electrical inspector ordered the transfer of registry of the D form certificate in this case. The relevant portion of the memorandum ran:
".... The Cliief Electrical Inspector considers that the ownership of the entire installation should be transferred till the period of the expiry of the lease deed in favour of the lessee who applied for a licence in form A. He suggests that this can be done by the Collector and Additional District Magistrate .... by sending the Electrical certificate issued in favour of the proprietor, to the Electrical inspector, with his recommendation for the transfer of the certificate in favour of the lessee who applied in form A may then be issued to the lessee after the electrical inspector effects the necessary changes in the entry regarding the name in the electrical certificate. The Government agree with the Chief Electrical Inspector and direct that action be taken accordingly".
14. The learned counsel for the petitioner contended that these instructions were ultra vires. The plea of the respondents was that these were instructions that came within the scope of Section 5(3) of the Act, which vested control of wide amplitude in the State Government. That control would be exercised over the licensing authority. Obviously it could also be exercised over anything ancillary to what the licensing authority is empowered to do.
15. The learned Advocate General who appeared for the first respondent contended that, under the scheme of the rules framed under the Act, it should be clear that the certificate in form D was only ancillary to the licence in form A that the licensing authority has to issue, The contention, in my opinion, is well founded. I have already referred to rule 13, which directs that the certificate in form D should be delivered along with the licence in form A, to the applicant for that licence.
The learned Advocate General was also well founded in his contention, that though provision is made in form D to show the name of the proprietor of the Cinema House and also that of the manager or persona-charge, they are merely descriptive, and it is not certainly within the province of the Chief Electrical inspector to decide the rights of parties, either to title or even the right to lawful possession. The Chief Electrical inspector is concerned only with the cinematograph apparatus, plant and the electrical installation in the cinema conforming to the prescribed standard of efficiency and that is all that be really certifies when he issues the certificate in form D. The rights of the petitioner as lessor and the first respondent as the lessee inter se were in no way affected by the transfer effected by the Chief Electrical inspector on 27-12-1954.
16. The learned Advocate General urged that Respite the use of the expression "renewal" in the rules, e.g., Rule 7 (1) (b) and Rule 11, the issue of certificate in form D would really be a fresh grant each time it is made. That grant depends upon the electrical apparatus etc., coming up to the required standards as disclosed during the inspection that precedes the grant of the certificate. The learned Advocate General referred to Sharp v. Wagefield, 1891 AC 173 (A). At p. 183 of the re-port, Lord Bramwell pointed out:
"The licence is a renewal. That word has seen criticised. It may be misleading, but is, I think, correct. It is a "renewal".-- i.e., a new licence, as we talk of a new lease being a renewal, bough parties and terms may be wholly different''. The learned Advocate General urged that in truth it was no transfer at all that the Chief Electrical inspector ordered on 27-12-1954. In effect he order-ed the issue of a D form certificate to the lessee, the first respondent, who had applied for the issue of the D form certificate and who was entitled to the licence in form A. There is much to be said for this point of view, though in form it was a renewed D form certificate that was transferred by the Chief Electrical inspector.
17. Taking the scheme of the rules into account it seems to me that the instructions issued in the Government memorandum dated 27-6-1950 were designed only to serve the administrative convenience, without in any way attempting the determination of any disputed legal rights. I have already pointed out that the D form certificate is but ancillary to the licence in form A. No licence in form A can be issued without the D form certificate. The jurisdiction of the licensing authority to order the transfer of an existing licence was upheld by me in Writ Petn.' No. 342 of 1955 (Mad) (B). In the present case, it should be remembered that it was a fresh licence in form A that was issued to the first respondent.
It is the Chief Electrical inspector that has to issue the certificate in form D, It would certainly be a measure of administrative convenience, if the Chief Electrical inspector knows who is the person that in fact has the use of the electrical apparatus etc., at a given point of time, and who has the custody of the certificate in form D, certifying to the fitness of that electrical equipment. If for that purpose the Government issued directions, that should an occasion arise for transfer for registry of the certificate in form D it is the Chief Electrical inspector that should order it and forward that certificate back to the licensing authority, it would be difficult to hold that these instructions were beyond the powers vested in the Government by Section 5(3) of the Act. The instructions are still to the licensing authority. Anything ancillary to what has to be done by the licensing authority is also within the scope of the control vested in the Government by Section 5(3) of the Act. In my opinion the instructions given by the Government in their memoran dum dated 27-6-1950 were intra vires.
18. The Chief Electrical inspector had jurisdiction to comply with the request preferred by the first respondent on 27-10-1954 to the licensing authority and order the registry of the certificate inform D in the name of the first respondent. It is true the petitioner as the lessor objected to the transfer. Those objections were considered; and the. Collector as the licensing authority had jurisdiction to overrule the objections, which he did on 10-1-1956. The exercise of the jurisdiction vested in neither of the statutory authorities was in any way vitiated in the circumstances of this case.
19. Once again I have to point out that the petitioner never applied for licence in form A for 1954-55 or 1955-56. It was only the first respondent that applied for that licence. The certificate in form D was issued to him as ancillary to the issue of the licence in form A. A fresh certificate in form D could have been granted to the first respondent. By calling it a transfer nothing more was achieved. It was open to the Government to waive a fresh fee for the issue of a fresh certificate in form D; and the issue of the certificate by adopting the procedure of transfer did not really affect the rights of the petitioner vis-a-vis the first respondent.
20. There is also this feature to he remembered. The transfer ordered by the Chief Electrical inspector related to the certificate issued for the period 1954-55, The currency of that certificate has expired. A fresh licence for 1955-56 was issued to the first respondent and as ancillary thereto, he should have obtained a fresh certificate in form D for 1955-56. The learned counsel urged that if the transfer granted by the order dated 27-12-1954 was invalid, there was no basis for a renewal for 1955-56. The learned counsel relied on K. Muthuvadivelu v. Regional Transport officer, AIR 1956 Mad 143 (C). The principles applicable to the renewal of a permit for a bus ordered under the provisions of the Motor Vehicles Act and the rules framed thereunder may not apply to the grant of licences or certificates under the Cinematograph Act. I have already pointed Out that despite the use of the word "renewal" in the rules it is really a fresh grant each time, and that applies both to the licence and to the certificate in form D. Independent of these considerations, I have held that the Chief Electrical inspector had jurisdiction to order what purported to be a transfer on 27-12-1954.
21. The rule is discharged and the petition is dismissed. There will however be no order as to costs.