1999 (10) TMI 641 - SC - Companies Law

Whether the order for eviction should be passed or not? whether an application for eviction under the Rent Control Act was maintainable notwithstanding the provisions of section 22? Held that - Appeal dismissed. The High Court and the Appellate Bench of the Small Causes Chief Court, are, therefore, right in coming to the conclusion that the provisions of section 22 did not in any way prevent the filing of an eviction petition on the ground of non-payment of rent and the order under section 11(4) of the Bombay Rent Act could be passed.

Summary

Issues:
1. Application under section 11(4) of the Bombay Rent Act for eviction.
2. Applicability of section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985.
3. Maintainability of the suit for recovery of money.
4. Interpretation of section 11(4) of the Bombay Rent Act.
5. Effect of section 22 on eviction proceedings.

Analysis:
1. The respondent filed a suit against the petitioner for eviction of the premises under section 11(4) of the Bombay Rent Act, alleging non-payment of rent. The trial court rejected the application, but the Appellate Bench and the High Court upheld it, concluding that section 22 of the Sick Industrial Companies Act did not apply in this case.

2. The petitioner argued that section 22 of the Act barred any suit for recovery of money against a sick company. However, the courts held that an eviction petition for non-payment of rent did not constitute a suit for recovery of money under section 22.

3. The petitioner contended that no notice under section 12(2) of the Bombay Rent Act had been issued, challenging the suit's maintainability. The courts noted that while such notice is required for a possession suit, an application under section 11(4) can still be filed to address rent withholding.

4. Section 11(4) allows the court to order the tenant to deposit rent if withholding on the grounds of excessive rent. The court must consider all circumstances before making such an order, separate from the issue of notice under section 12(2).

5. The courts relied on precedent to determine that eviction proceedings for non-payment of rent were not barred by section 22. The protection under the Rent Control Act against eviction is lost upon non-payment, allowing for eviction orders without constituting a suit for recovery of money.

In conclusion, the petition was dismissed as the courts found that section 22 did not prevent the filing of an eviction petition for non-payment of rent under section 11(4) of the Bombay Rent Act. The judgments upheld the applicability of eviction orders in such cases despite the provisions of section 22 of the Act.