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Issues Involved:
1. Jurisdiction of the City Civil Court 2. Applicability of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Bombay Act LVII of 1947) 3. Ownership and exemption under Section 4(1) of the Bombay Act LVII of 1947 Detailed Analysis: 1. Jurisdiction of the City Civil Court: The primary issue was whether the City Civil Court had jurisdiction to entertain the suit filed by the appellant for possession of the premises. The respondent argued that under Section 28 of the Bombay Act LVII of 1947, the City Civil Court did not have jurisdiction as the Court of Small Causes alone had jurisdiction to entertain and try any suit between a landlord and a tenant relating to the recovery of rent or possession of any premises to which the provisions of the Act applied. The Supreme Court held that a Civil Court has inherent power to decide the question of its own jurisdiction. Therefore, the preliminary objection regarding jurisdiction was rejected. 2. Applicability of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947: The main controversy was whether the Bombay Act LVII of 1947 applied to the demised premises. The resolution of this issue depended on the interpretation of Section 4(1) of the Act, which states that the Act shall not apply to premises belonging to the Government or a local authority. The appellant contended that the premises belonged to the Bombay Municipality, a local authority, and thus, the Act did not apply. The respondent argued that the Act aimed to control rent and should apply to the relationship between landlord and tenant, regardless of the ownership of the premises. 3. Ownership and Exemption under Section 4(1) of the Bombay Act LVII of 1947: The Supreme Court analyzed Section 4(1) of the Act, which exempts premises belonging to the Government or a local authority from the Act's provisions. The Court concluded that the Legislature intended to confer immunity on the premises themselves, not just the relationship between the Government or a local authority and its lessee. The Court reasoned that this immunity was meant to protect and further the interests of the Government or a local authority by facilitating the development of its lands and increasing the value of its reversionary interest. The Court held that the demised premises, including the building, belonged to the Bombay Municipality, and thus, were outside the operation of the Act. The Court rejected the High Court's reasoning that the building, in substance, belonged to the lessee. It emphasized that the lease was a transfer of the right to enjoy the premises, not a transfer of ownership. The lessee's rights were limited by covenants that indicated the lessor's dominant voice and real ownership. The Court concluded that the demised premises, including the building, belonged to the local authority and were exempt from the Act's provisions. Conclusion: The Supreme Court allowed the appeal, set aside the judgment and decree of the High Court, and restored the decree passed by the City Civil Court. The appellant was entitled to costs throughout in all Courts. The City Civil Court had jurisdiction to entertain the suit, and the Bombay Act LVII of 1947 did not apply to the demised premises as they belonged to a local authority.
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