1998 (5) TMI 341 - SC - Companies Law

Whether in any form the unregistered body has converted itself into a registered body as a company? Held that - Appeal dismissed. The fact that the appellant is a distinct legal entity as found by the authorities below and affirmed by the High Court. Cannot be seriously disputed. Since the appellant is a distinct legal entity other than the unregistered bodies and there is no material to show that it is a successor thereto it is not understandable as to how it became a tenant in respect of the premises in question without an agreement with the society or respondent No. 2 who is a member thereof. It baffles us and thus the view taken by the High Court appears to us to be correct.

Summary

Issues:
1. Interpretation of agreements between parties for tenancy.
2. Jurisdiction of authorities under the Maharashtra Co-operative Societies Act.
3. Legal entity status of the appellant company and its tenancy rights.

Analysis:

Issue 1: Interpretation of agreements for tenancy
The case involved a dispute regarding the tenancy of premises between the appellant company and the respondent. The appellant claimed to have been a tenant since 1969 under a leave and license agreement. The respondent sought eviction through legal proceedings, leading to an arbitration award and subsequent appeals. The High Court upheld the eviction order, prompting the appellant to appeal to the Supreme Court.

Issue 2: Jurisdiction under Maharashtra Co-operative Societies Act
The appellant argued that the authorities under the Maharashtra Co-operative Societies Act lacked jurisdiction due to a pending dispute under the Bombay Rent Act. However, the Supreme Court clarified that the society's business activities, including letting out premises, fell within the scope of the Act. Previous court decisions supported the view that disputes related to possession and eviction could be addressed under section 91 of the Act, even alongside other legal proceedings.

Issue 3: Legal entity status and tenancy rights
The appellant contended that it was a successor to unregistered bodies and thus entitled to tenancy rights. However, the court found insufficient evidence to establish this succession. The appellant's incorporation as a company was distinct from the unregistered bodies, with no clear conversion process evident. The court scrutinized the appellant's articles and membership clauses, concluding that the appellant was a separate legal entity without a valid agreement for the tenancy. Consequently, the court rejected the appellant's argument regarding its legal entity status and tenancy rights.

In conclusion, the Supreme Court dismissed the appeal, upholding the eviction order. The court granted time for the appellant to vacate the premises, emphasizing voluntary possession delivery to the respondent. No costs were awarded, considering the circumstances of the case.