2001 (7) TMI 1179 - HC - Companies Law

Summary

Issues:
1. Protection under Sick Industrial Companies (Special Provisions) Act, 1985 for non-payment of lease rentals and possession of wind-mills.
2. Suit for recovery of unpaid lease rentals and return of wind-mills due to lease agreement termination.
3. Jurisdiction of courts in relation to the lease agreement.

Analysis:

Issue 1:
The appellant sought protection under the Sick Industrial Companies (Special Provisions) Act, 1985, to avoid paying lease rentals and retain possession of wind-mills without compensating the lessor. However, the lease agreement was terminated due to non-payment, leading to a suit for recovery filed by the respondent.

Issue 2:
The appellant contested the suit, citing section 22 of the Act and a separate suit for damages filed in Pune. The respondent filed applications for possession of equipment, which were granted by the Single Judge, considering section 22 and the appellant's failure to comply with lease obligations.

Issue 3:
Regarding jurisdiction, the lease agreement specified Pune courts for legal proceedings. The appellant argued for Pune's exclusive jurisdiction, while the respondent contended that the restriction applied only to the lessee. The court analyzed the clause, emphasizing the need for clear, unambiguous language to exclude other courts' jurisdiction. As the clause did not explicitly exclude other courts, the wider interpretation favored maintaining jurisdiction, especially since the appellant had not paid instalments and sought to continue using the machinery.

The court dismissed the appeal, upholding the Single Judge's decision and ordering costs against the appellant.