2007 (8) TMI 809 - HC - Indian Laws

Summary

Issues involved: Application under Order VII Rule 11 of CPC for rejection of plaint on grounds of suit being barred by law u/s 446 of Companies Act, 1956.

Issue 1 - Suit Barred by Law (u/s 446 of Companies Act, 1956):
The defendant No. 2 filed an application under Order VII Rule 11 of CPC seeking rejection of the plaint on the grounds that the suit is barred by law u/s 446 of the Companies Act, 1956, as it was filed against a company (defendant No. 1) that had been wound up. The defendant argued that the suit should be rejected as no permission was obtained from the Company Court prior to filing the suit against a wound-up company. Reference was made to a Division Bench decision of the Bombay High Court emphasizing the necessity of obtaining permission before suing a wound-up company. The defendant contended that since the suit is barred by Section 446, the plaint should be rejected.

Issue 2 - Maintainability of Suit Against Defendant No. 2:
The plaintiffs argued that the suit is not barred, stating that the property in question was initially leased to defendant No. 1, who used it for the residence of defendant No. 2, the then Managing Director. After the leases expired, the defendants were required to vacate the premises. The plaintiffs claimed that they were unaware of defendant No. 1 being wound up earlier and served legal notices to both defendants. Defendant No. 2 replied claiming tenancy rights. The court noted that defendant No. 2 was in unauthorized occupation of the property, as no lease deed or arrangement existed for his continued possession. Despite arguments, the court found the suit maintainable against defendant No. 2 in his personal capacity, as the plaint cannot be rejected in part.

Judgment:
After considering arguments and examining the plaint and accompanying documents, the court held that the application under Order VII Rule 11 CPC cannot be allowed. The court found the suit maintainable against defendant No. 2, who was in unauthorized occupation of the property. As the suit cannot be rejected in part, the application was rejected, allowing the suit to proceed against defendant No. 2.