1987 (9) TMI 368 - HC - Companies Law

Summary

Issues Involved:
1. Maintainability of the application.
2. Possession and title of the disputed property.
3. Applicability of section 446 of the Companies Act, 1956.
4. Execution of the decree and eviction process.

Summary:

1. Maintainability of the Application:
The appellant argued that the application was not maintainable as the room was not the property of the company and the official liquidator never took charge of it. The court, however, held that the application was maintainable under section 446(2) of the Companies Act, 1956, which allows the court to entertain any claim or question arising in the course of the winding-up of the company. The court referenced the Division Bench judgment in Indramoni v. Shriram Jute Mills P. Ltd., which supported the maintainability of such applications.

2. Possession and Title of the Disputed Property:
The appellant claimed title through Makhan Lal Sharma, asserting that he was the successor-in-interest. The court found that the appellant failed to prove his right, title, and interest in the said room. The appellant did not avail the opportunity to present evidence, and no substantial proof was provided to establish the devolution of interest from Makhan Lal Sharma to the appellant. Consequently, the court held the appellant to be a trespasser.

3. Applicability of Section 446 of the Companies Act, 1956:
The respondents argued that the application was maintainable under section 446(2), which grants the court jurisdiction over any claim or question arising in the course of the winding-up. The court agreed, stating that the questions raised in the application fell within the scope of section 446(2). The court also noted that the official liquidator would be deemed to be in possession of the property under section 456, even if actual possession was not taken.

4. Execution of the Decree and Eviction Process:
The appellant contended that no person could be evicted without due process of law and that the execution application had been set aside in appeal. The court clarified that proceedings under section 446 constitute due process of law. The court found that the appellant was a trespasser and that the applicants had the right, title, and interest in the property. Therefore, the contention regarding eviction without due process was rejected.

Conclusion:
The court dismissed the appeal with costs, affirming the maintainability of the application and the right of the respondents to the disputed property. The interim order, if any, was vacated.