DAGA FILMS Vs. LOTUS PRODUCTION

JUDGEMENT

(1.) This suit w,as filed by Messrs. Daga Films, the plaintiff herein, against Messrs. Lotus Production and Mr. D. N. Mehta for (a) declaration that the document dated 7th April 1970 is void and/or voidable; (b) perpetual injunction restraining the defendants from enforcing the said document dated April 7, 1970 by realising any further sum from the plaintiff in respect of the film 'Juari'; (c) decree for Rs. 1,00,000/- by way of damages and (d) injunction, Receiver cost and other consequential reliefs.

(2.) The defendant No. 1 did not contest the suit nor filed any written statement The defendant No. 2 Mr. D. N. Mehta filed a written statement and also contested the suit. The facts of this case are that the plaintiff carried on business in partnership as distributor of cinematographic films and the defendant No. 1 carried on business of motion pictures production at Ranjit Studio, Dadar, Bombay. The defendant No. 1 as such producer was producing a motion picture in Hindi version in black and white title 'Juari'. On 18th March 1964 an agreement was executed by and between the plaintiff and the defendant No. 1 wherein the defendant No. l assigned to the plaintiff the sole and exclusive right of execution, distribution and exploitation of the said picture 'Juari' in the Bengal Circuit territory, on various terms and conditions as contained in the original document dated 18th March 1964. The relevant clauses for the purpose of this suit are (1) in consideration of the assignment the distributors agreed to pay to the producer a sum of Rs. 1,30,000/- by way of minimum guarantee basis. Over and above, the distributors agreed to spend on behalf of the producer a sum of Rupees 40,000/- towards publicity. The producers agreed to supply to the distributor nine brand new positive release prints duly censored. It was further agreed that if the distributors required any extra prints or loan prints the same shall be supplied by the producer provided raw stocks were available and the negatives were in fit condition to take out such prints. Costs for such prints shall be paid by the distributor at the time of placing of such order. Distributors shall not cut, tamper with, edit, dupe or dub in any language the said picture. The producers agreed that they would complete the picture, get it censored and deliver to the distributors the quota release prints on or before 30th June 1964 with a grace period of two months. In case the producers fail to deliver the release prints on or before the expiry of the grace period, distributors shall be entitled to cancel the agreement and demand repayment of the amount with interest at 9%. In case the distributors fail to deliver the quota prints against stipulated payment within two months from date of the written intimation from the producers the producers shall have the option to terminate the agreement. Pursuant to that agreement, the plaintiff duly paid to the defendant No. 1 a sum of Rs. 60,000/-.

(3.) In October 1969 it was further agreed by and between the plaintiff and the defendant No. 1 that the defendant No. 1 would deliver or cause to be delivered 12 brand new prints to the plaintiff instead of 9 prints. By a letter dated 17th October 1969 the defendant No. 1 intimated to the plaintiff about further mutual agreement that was arrived at on 15th of October, 1969. Under the said agreement the plaintiff agreed to pay a total sum of Rs. 1,95,000/- on outright sale basis for perpetual period and not on minimum guarantee basis as was agreed upon by the first agreement, against delivery of 12 quota brand new released prints the plaintiff agreed out of the agreed amount of Rs. 1,35,000/- to send a bank draft of Rs. 35,000/- to Messrs. Ramnord Research Laboratories Ltd. for purchasing black and white positive stock for preparing 12 prints and will pay a sum of Rs. 1,00,000/- against delivery of 12 quota prints. The defendant No. 1 agreed to indemnify the plaintiff from any claim or loss for the said picture in the Bengal Circuit excluding Bihar and Nepal. By letter dated 3rd of July, 1968 the defendant No. 1 requested the plaintiff to get the said picture released in the Bengal Circuit and complained that the plaintiff had no inclination of taking delivery of material against payment of Rs. 20,000/-. In that letter the defendant No. 1 also stated that if the agreement was cancelled they would deposit with E. I. M. P. A., Calcutta the sum of Rs. 60,000/- so far paid by the plaintiff to enable them to negotiate and dispose of the distribution rights in respect of the said picture to any other party.