Rule 234 - Vesting of disclaimed property - Limited Liability Partnership (Winding up and Dissolution) Rules, 2010

Vesting of disclaimed property 234. Where the disclaimed property is a leasehold interest and an application is made by any person who either claims any interest in any disclaimed property or is under any liability not discharged by the Act in respect of any disclaimed property, and after hearing any such persons as it thinks fit, make an order for the vesting of the property in, or the delivery of the property to, any person entitled thereto or to whom it may seem just that the property should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the Tribunal thinks just; and on any such vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any conveyance or assignment for the purpose : Provided that, where property disclaimed is of a lease-hold nature, the Tribunal shall not make a vesting order in favour of any person claiming under the LLP, whether as under-lessee or as mortgagee or holder of a charge by way of demise, except upon the terms of making that person (a) subject to the same liabilities and obligations as those to which the LLP was subject under the lease in respect of the property at the commencement of the winding up; or (b) if the Tribunal thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date, and in either event (if the case so requires) as if the lease had comprised only the property comprised in the vesting order; and any mortgagee or under-lessee declining to accept a vesting order upon such terms shall be excluded from all interest in and security upon the property, and, if there is no person claiming under the LLP who is willing to accept an order upon such terms, the Tribunal shall have power to vest the estate and interest of the LLP in the property in any person liable, either personally or in a representative character, and either alone or jointly with the LLP, to perform the lessee s covenants in the lease, freed and discharged from all estates, encumbrances and interests created therein by the LLP. (2) The Tribunal may adjourn the application for such notice to be given and for such under-lessee, mortgagee or holder of charge, to be added as a party to and served with a copy of the application, and to make, if he sees fit, such election and application as is mentioned in the notice. If at the expiration of the time so fixed by the Tribunal, such under-lessee, mortgagee or holder of charge, fails to make such election and application, the Tribunal, may make an order vesting the property in the applicant or other person who, in the opinion of the Tribunal, may be entitled thereto, and excluding such under-lessee, mortgagee or holder of charge, from all interest in or security upon the property. (3) Any person injured by the operation of a disclaimer under this rule shall be deemed to be a creditor of the LLP to the amount of the compensation or damages payable in respect of the injury, and may accordingly prove the amount as a debt in the winding up. (4) An order requiring parties interested in a disclaimed lease to apply for a vesting order or to be excluded from all interest in the lease shall be in Form No. 81, and an order vesting lease and excluding persons who have not elected to apply, shall be in Form No. 81A.